AUD/USD sees little action even as Aussie Building Permits tank 15.3%
- Dismal Aussie housing data and current account balance fail to move the needle in AUD/USD.
- RBA is expected to cut rates by 25 basis points on Tuesday.
- A status quo would be a hawkish surprise and will likely put a bid under the Aussie dollar.
The AUD/USD pair is seeing little action with investors turning a blind eye toward the horribly weak Aussie building permits number and awaiting the all-important Reserve Bank of Australia (RBA) rate decision.
The building permits fell 15.3% month-on-month in January, missing the expected rise of 1% by a big margin and down from December's 3.9%. In annualized terms, permits fell by 11.3% in January versus 7.2% previously.
Meanwhile, Australian current account surplus narrowed to A$ 1 billion in the fourth quarter from A$6.5 billion observed in the third quarter.
So far, however, the dismal data sets have failed to yield big moves in the Aussie dollar pairs. AUD/USD is currently trading largely unchanged on the day near 0.6536, having shed five pips or so following the release of the Aussie data at 00:00 GMT.
The investors look to be waiting on the sidelines ahead of the RBA rate decision due at 03:30 GMT. Goldman Sachs, Westpac and National Bank of Australia expect the central bank to cut interest rates by 25 basis points to a new record low of 0.5%.
Also, money markets have priced in a 25 basis point cut. So, if the RBA leaves rates unchanged, the AUD will likely pick up a strong bid. Alternatively, if the RBA cut rates and leaves the door open for another reduction in April, the AUD may face selling pressure.