At 2230GMT – Australian Industry Group (AIG) performance of Services Index, also known as the AIG services PMI , for October. Prior was a big jump to 47.1.
0330GMT – Reserve Bank of Australia (RBA) monetary policy decision is announced.
- There is not expected to be any change, most recent OIS pricing had the chance of a 25 bp rate cut at just 5%.
- The accompanying statement should make the case that the effects of previous rate cuts are starting to feed through into the economy with economic indicators improving. On the AUD they will likely say it is too high and they’d like to see it lower in order to aid in the transition of the economy from mining investment to other sectors. They should also mention that they expect it to fall again when the Fed begins to wind back on asset buys (tapering).
Note that it is somewhat of an unofficial market holiday today. Melbourne is out due to the Melbourne Cup holiday, and many on desks in Sydney will be heading off for Melbourne Cup related functions at lunchtime. The RBA decision today is in very, very little doubt at all (no change) so it could well be a bit of a lacklustre session in the AUD after midday local time.
