The Australian dollar remains trapped in a narrow trading range

Star Wars/Lucas Films
  • The Australian dollar continues to trade in a narrow trading range just under US70 cents.
  • Most of the main data events in Asia will come from New Zealand on Wednesday.
  • The Bank of Canada will announce its May interest rate decision. No change in policy is expected.

The Australian dollar remains stuck in a narrow trading range against the greenback, continuing the theme seen earlier in the week.

Here’s the scoreboard at 7am in Sydney on Wednesday.

AUD/USD 0.6922 , 0.0005 , 0.07%
AUD/JPY 75.69 , -0.05 , -0.07%
AUD/CNH 4.7902 , 0.0128 , 0.27%
AUD/EUR 0.6201 , 0.0026 , 0.42%
AUD/GBP 0.5471 , 0.0016 , 0.29%
AUD/NZD 1.0574 , 0.001 , 0.09%
AUD/CAD 0.9342 , 0.0044 , 0.47%

After closing at .6917 on Monday, the AUD/USD traded in a tiny 22 pip range throughout Tuesday’s trading session, largely reflecting a lack of new catalysts to dictate direction.

There was little reaction to weakness in iron ore prices or stocks during the session, nor the release of mixed US economic data.

The U.S. Conference Board’s consumer confidence index hit a six-month high in May. However, the Dallas Fed manufacturing index weakened unexpectedly in May, falling into negative territory.

Investing.comAUD/USD Hourly Chart

While the Aussie went nowhere against the greenback, it did manage to strengthen against most major crosses.

The euro was weighed down by renewed jitters about Italian debt levels. Despite early gains in crude oil prices, the Canadian dollar weakened ahead of the Bank of Canada’s May interest rate decision on Wednesday.

The Japanese yen was supported by safe-haven buying, helped by a modest deterioration in investor risk appetite on renewed concerns about the prospect of a U.S.-Sino trade deal being reached anytime soon.

Turning to the day ahead, it looks set to be another quiet session in Asia with little in the way of market moving data or events.

Most of the action will be in New Zealand with the release of the NBNZ business confidence survey for May. RBNZ Governor Adrian Orr will also speak at 9am AEST.

There’s very little else on the Asian calendar, pointing to the likelihood that Chinese markets, and any trade headlines, will likely dictate broader direction.

Later in the day, other data highlights include French CPI, German unemployment along with the Richmond Fed manufacturing index in the United States.

As mentioned above, the Bank of Canada will announce its May monetary policy decision at midnight AEST. The key overnight rate is widely expected to remain at 1.5%, leaving commentary from the bank to determine how the Loonie will fare.

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.