Aussie Slides Lower Despite Upbeat RBA

Currencies saw a very quiet trading session in Asia with mild risk off appetite dominating flow as the region’s equity slipped lower. In Australia the RBA issued is semi annual Financial Stability Review in which the central bank was generally upbeat about economic conditions Down Under.

The RBA noted that measures of household stress remain low, that most Australian households were well placed to meet their obligations and Bank remained in “relatively strong condition”. However Australian monetary officials acknowledged that retail, manufacturing and tourism sectors face headwinds due to a strong currency and that the EU crisis still poses risk to the global growth scenario.

The generally constructive tone of the Financial Stability Review failed to support the Aussie which drifted lower through Asian session trade towards the 1.0400 figure as decline in risk appetite along with some buying of EUR/AUD and GBP/AUD weighed on the pair.

With little economic data in European session, the major may be in for another another tight listless night of trade with EUR?USD continuing to hold support above the 1.3300 level for the time being.

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