Forex – Aussie Dollar Little Changed After RBA; Yuan Inches Higher

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Forex - Aussie Dollar Little Changed After RBA; Yuan Inches Higher

Investing.com – The Aussie dollar was little changed on Tuesday after the Reserve Bank of Australia left its overnight rate unchanged at 1.5%. The Chinese yuan inched higher as an official of the People’s Bank of China said internationalisation of the Chinese currency is market-driven.

The AUD/USD pair was unchanged at 0.7211 by 12:01 AM ET (04:01 GMT), while the NZD/USD pair was up 0.1% to 0.6652. The RBA said it expected a “gradual pickup” in inflation and GDP will grow at around 3.5% over the next few years.

Meanwhile, the USD/CNY pair was down 0.1% at 6.9239 after Huo Yingli, director general of the Monetary Policy Department II of the People’s Bank of China (PBOC), said during the China International Import Expo on Monday that Internationalisation of China’s yuan is market-driven.

“Yuan internationalisation is a natural process driven by the market, and its basic motivation is real demand from trade and investment,” said Huo Yingli, director general
The People’s Bank of China (PBOC) set the yuan reference rate at 6.9075 vs the previous day’s fix of 6.8976.

The U.S. dollar index that tracks the greenback against a basket of other currencies was up 0.1% at 96.19 as investors awaited the U.S. midterm elections due later in the day.

“Markets are increasingly pricing in the possibility of a victory for the Republicans – even in the House,” said Masafumi Yamamoto, chief currency strategist at Mizuho Securities.

A Republican victory in both chambers was likely to boost the U.S. dollar, Yamamoto added.

Elsewhere, the USD/JPY pair was up 0.1% at 113.34.

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