The Australian dollar firmed yesterday after the Reserve Bank announced a continuation of its current policies, and did not highlight any fresh concerns over the currency still being at historically very high levels. The lending rate, as expected, was also held at 2.5%, where many expect it to be for the foreseeable future, in order to support a still vulnerable economic recovery. The Australian currency was also supported by some positive data out of China – good news for the Australian economy, with China being a primary export destination for commodity-reliant Australia. And finally growth figures released overnight highlighted the robustness of the Australian economy.
It was a relatively flat day elsewhere, with the Japanese yen being the only other mover of note. After a difficult day on Monday, the yen recovered slightly yesterday following an increased appetite for safe-haven assets. Looking forward to today, we have trade balance figures and an interest rate decision out of Canada. Eyes will also be on Brussels for Day One of the G7 meetings.
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