The RBA left interest rates unchanged at 2.50% today as widely expected. The central bank also maintained that "on present indications, the most prudent course is likely to be a period of stability in interest rates." Also, the RBA held the outlook for economy unchanged, expecting growth to strengthen with help from lower interest rates and lower exchange rate. Inflation is expected to be within 2-3% target range over the next two years. And unemployment is expected to rise further before peaking. Aussie is staying in tight range above 0.89 against dollar after the release.
The euro and Sterling are so far most troubled by the tension in Ukraine. ECB president Draghi said in a testimony to European parliament that the "geopolitical dimensions" of the situation in Ukraine are "completely different" from the emerging market turmoil earlier this year. Currently, Draghi noted that Ukraine just accounts for less than 1% of Eurozone exports but the geopolitical dimensions could have a "capacity to affect events which may go beyond the actual links." And he pledged to watch the situation with great attention.
Regarding other issues, Draghi said the executive board has presented a proposal to the governing council regarding minutes. And, he noted there will be "complex discussion" as the minutes have to be rich, informative, transparent while protecting "independence" of the governing council members. It's reported that ECB might start to draft trial minutes and experiment with the formats in the coming months. After the stronger than expected Eurozone inflation data released last week, the ECB is generally expected to keep rates on hold at 0.25% this week. But some analysts still noted a minor risk of a rate cut.
On the data front, Australia building approvals rose strongly by 6.8% mom in January. Japan monetary base rose 55.7% yoy in February, labor cash earnings dropped -0.2% yoy in January. UK will release PMI construction while Eurozone will release PPI later today.