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Oil support and RBA preview keep FX in tight ranges in Asia
Traders were positioned for an expected hawkish hold from the Reserve Bank of Australia, with its decision due at 2:30pm Sydney time.
Oil stayed supported amid no Strait of Hormuz deal and continued disruption risk, helping keep broader sentiment toward commodities steady as Asia-Pacific trading progressed. Separately, Libya's National Oil Corporation declared force majeure at its 120,000 bpd Zawiya refinery after clashes between armed groups, while other refinery and attacks were also reported.
In currency trading, FX moved within subdued, tighter ranges. Australian dollar traders were awaiting the Reserve Bank of Australia decision at 2:30pm Sydney time, followed by Governor Bullock's press conference about an hour later.
Market participants expected a hawkish hold from the RBA, with the RBA preview also influencing short term rate expectations. In Japan, Japanese markets were closed for a holiday, and while media reports cited growing expectations for a Bank of Japan rate hike in September, the yen still fell in a small range.
Outside the major FX focus, Singapore reported Q2 economic growth of 5.9% year on year, beating forecasts, and raised its 2026 growth outlook to 4.5-5.5% from 2.0-4.0%. According to the Monetary Authority of Singapore, the central bank said its monetary policy stance remains appropriate.