Aussie recovered today after RBA stood pat and remained neutral. Cash rate was left unchanged at 2%, after cutting it by -25 bps a month ago. Policymakers refrained from giving forward guidance on further monetary outlook but noted that further easing would be data-dependent. Besides general economic developments, policymakers again paid particular attention to the housing market, noting that 'dwelling prices continue to rise strongly in Sydney'. The noted that the central bank is' working with other regulators to assess and contain risks that may arise from the housing market'. On exchange rate, the RBA acknowledged the recent decline in AUDUSD but reinforced that 'further depreciation seems both likely and necessary'. More in RBA Left Cash Rate Unchanged, Noting Further Easing Dependent On Data. Also released down under, Australian current account deficit widened to AUD -10.7b in Q1. New Zealand terms of trade rose 1.5% qoq in Q1.
In Japan, prime minister Shinzo Abe and BoJ governor Haruhiko Kuroda met today and discussed global economy after Yen dropped to the lowest level against dollar since 2002. Nonetheless, Kuroda said after the meeting that currency was not a topic of discussion and he declined to comment on recent movements. Japan finance minister Taro Aso also said that finance ministers "normally don't comment on currencies" but they'll continue to watch the markets closely. Released from Japan, labor cash earnings rose 0.9% yoy in April versus expectation of 0.4% yoy. Monetary base rose 35.6% yoy in May versus expectation of 34.3%.
In Eurozone, negotiation between Greece and international creditors remained the major focus. German chancellor Angela Merkel, IMF chief Christine Lagarde, ECB president Mario Draghi, French president Francois Hollande and European Commission president Jean-Claude Juncker met yesterday to hammer out an offer for Greece to consider. Merkel's office said in a statement afterwards that the five leaders "agreed that work must now be continued with greater intensity. Greece is facing a string of four repayments to IMF this month totalling EUR 1.6b. That will start with the smallest installment this Friday. German employment, Eurozone PPI will be released in European session but main focus would be on Eurozone CPI flash. UK will also release Mortgage approvals, M4 and construction PMI.
In US, Fed Vice Chair Stanley Fischer argued that the Fed is not "lifting off". Regarding the interest rate outlook, he suggested that the Fed is "going up with the interest rate, then along, and then another little jump. That's not liftoff, that's crawling". Boston Fed President stated that he does not "expect to see timely improvements in the unemployment rate and sufficient progress towards the 2% inflation target... This, in my view, makes a compelling argument for continued patience in monetary policy". US will release factory orders later today.