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Aussie Drops After RBA Minutes; U.S. Dollar Flat

2019-2-19 15:26:24Basics of Trading
Aussie Drops After RBA Minutes; U.S. Dollar Flat

The Australian dollar traded lower after the Reserve Bank of Australia (RBA) minutes showed “significant uncertainties” on the economic outlook.

According to the minutes, the Monetary Policy Board saw significant uncertainties on the economic outlook as the housing markets nosedives. RBA members said they would continue to “assess the outlook carefully.”

The minutes also said policymakers believed there is no strong case for a near-term move in interest rates, as it was better to be a source of stability.

After briefly ticking higher following the release of the minutes, the Aussie dollar quickly retreated lower. At 11:34 PM ET (04:34 GMT), the AUD/USD pair was down 0.3% at 0.7109.

Meanwhile, the U.S. dollar was steady against its peers on Tuesday, lacking strong direction as U.S. markets were shut for a holiday the previous day.

The U.S. dollar index that tracks the greenback against a basket of other currencies was up 0.02% at 96.762.

Trade-related headlines are expected to be a major focus again later this week, as Chinese Vice-Premier Liu He is set to visit Washington for a new round of negotiations with the U.S.

He will meet U.S. Treasury Secretary Steven Mnuchin and U.S. Trade Representative Robert Lighthizer, the Commerce Ministry said in a short statement on Tuesday.

The last round of negotiations ended last week in Beijing without a deal, although U.S. President Donald Trump and his Chinese counterpart Xi Jinping both reported progress in trade talks last week, raising hopes of an agreement before a March 1 deadline for tariff hikes.

“We’re making a lot of progress. Nobody expected this was going to be happening,” Trump told a crowd in Florida.

U.S. tariffs on $200 billion in Chinese goods will increase to 25% from 10% if no deal is reached by March 1.

Elsewhere, the USD/CNY pair was up 0.1% at 6.7736.

The USD/JPY pair also edged up 0.1% at 110.64.