RBA Holds Rates For Now

Morning Report: 06.30 London

• This morning, the RBA kept rates on hold at 2.00% as expected, but a widening trade balance deficit opens up the door for cuts in the future. The Aussie is experiencing minor selling this morning, but the New Zealand Dollar is experiencing some follow-on selling after yesterday’s plunge.

• The Yen pairs are experiencing the biggest movements so far, with the USD/JPY extending its recent losing run.

• Meanwhile sinking oil prices are helping the US Dollar to keep the sellers at bay.

Coming up today:

• Coming up today we have German factory orders at 07.00.

• Following this, we have a series of lower tier European services PMI data points.

• Then at 09.30, we have UK services PMI.

• From 13.30, we switch to Canada and US for trade balance.

• US ISM non-manufacturing PMI follows at 15.00, with JOLTS job openings at the same time.

Trade Idea:

• The GBP/JPY continues to struggle and could have further to fall if the Brexit uncertainty continues to weigh on the Pound alongside a generally meek economy.

                     

A good way to play this is a LOWER trade predicting that the GBP/JPY will close below 156.00 in 14 days for a potential return of 217%.
                         
                                                         

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