• Minutes from the latest RBA policy meeting contained no surprises;
  • RBA assistant-Governor Debelle unsurprisingly tried to talk the A$ down with comments like “lower capital inflows may result in a lower A$”;
  • S&P clarified their overnight comments regarding a possible downgrade for Australia, stating that there is a ‘less than 1-in-3 chance of this happening;
  • The Thai military introduced martial law to maintain law and order but insisted that it was not a coup;
  • Chinese commerce ministry official- high growth period for trade is over;
  • Asian equity markets were generally around 0.5% higher.

The AUD was the main mover of the day, with the falling iron ore price the main driver. That market fell back below $100 overnight and the S&P comments that a credit downgrade for Australia was even being contemplated also added to the bearish tone. Stops in AUD/USD below the 21-dma at .9318 were triggered once standing bids were cancelled prior to the release of the RBA minutes. AUD selling has also been noted against the GBP and the NZD.

The JPY has been quiet with EUR/JPY buying being counterbalanced by AUD/JPY selling.

GBP should have a busy European session with CPI and retail sales data due for release.

Most interest in the EUR concentrated around the crosses but flows were overall very light.