The Australian dollar has found some support after being crunched earlier in the week

Martin Philbey/Redferns
  • Thursday was a fairly bland session for currency markets.
  • After plunging the most since the Brexit referendum on Wednesday, the Aussie dollar traded sideways.
  • The RBA will release its quarterly SoMP today but it should contain few, if any, surprises. The calendar elsewhere is quiet.

After logging its largest decline since the Brexit referendum on Wednesday, the Australian dollar was near static on Thursday, reflective of the broader theme across currency markets during the session.

Here’s the scoreboard at 7.50am in Sydney on Friday.

AUD/USD 0.7104 , 0.0001 , 0.01%
AUD/JPY 78.02 , -0.08 , -0.10%
AUD/CNH 4.8199 , 0.006 , 0.12%
AUD/EUR 0.6260 , 0.001 , 0.16%
AUD/GBP 0.5483 , -0.0008 , -0.15%
AUD/NZD 1.0520 , 0.0041 , 0.39%
AUD/CAD 0.9447 , 0.0061 , 0.65%

With the exception of the Canadian and New Zealand dollars that were undermined by weakness in crude prices and economic data respectively, the Aussie stuck to relatively small ranges against all of the major crosses.

The AUD/USD traded between .7090 to .7117 throughout the session, a performance in stark contrast to Wednesday when it moved in a massive 160 pip range.

Investing.comAUD/USD Hourly Chart

The lack of movement came despite a string of negative headlines on the current state of US-Sino trade negotiations, including news that Donald Trump and Xi Jinping are unlikely to meet before March 1, the hard deadline set by Trump for increased US tariffs to kick-in.

Similar modest moves were also seen against the Japanese yen, euro and British pound, the latter two trimming earlier losses that were sparked by renewed concern about the outlook for the European economy.

Turning to the day ahead, it looks set to be a quiet end to the week, even with the release of the RBA’s quarterly Statement on Monetary Policy (SoMP) at 11.30am AEDT.

We already know the RBA has downgraded its GDP and inflation forecasts, and kept its unemployment view much the same. We also know that the potential triggers for a rate cut are a sustained lift in the unemployment rate or greater evidence that underlying inflation may not return to the RBA’s target band.

Given we already know this, there’s unlikely to be very few surprises, if any at all. There will still be some interesting commentary and charts, but that’s not likely to be of interest to markets.

Outside of Australia, Japan will release household spending, labour cash earnings and current account data for December.

In the second half of the session, the main highlights are industrial output figures from Italy and France, German trade along with Canadian unemployment data for January.

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