Anna 
During Wednesday’s European session, the AUD/JPY pair edged lower to near 98.70, driven by prevailing risk-off sentiment that bolstered demand for the safe-haven Japanese Yen (JPY). Investors exercised caution amid speculation that Japanese authorities may intervene in the markets to prevent a significant depreciation of the Yen.
Despite the Bank of Japan’s (BoJ) cautious approach towards further policy tightening, the Japanese Yen (JPY) struggled to sustain its strength in the current market environment. While the BoJ’s stance failed to ignite bullish sentiment or generate significant momentum, the JPY maintained its safe-haven appeal amidst broader market uncertainties.
The Australian Dollar (AUD) encountered difficulties, influenced by the decline in the ASX 200 Index, which exerted downward pressure on the AUD/JPY cross. However, positive data from the Australian Industry Group (AiG) Industry Index for February, which rose to -5.3 from the previous -14.9, and the AiG Manufacturing Purchasing Managers’ Index (PMI) at -7, compared to the prior reading of -12.6, provided some support.
In the Reserve Bank of Australia (RBA) March meeting minutes, the board indicated that they did not consider the option of raising interest rates. Despite acknowledging the uncertain economic outlook, the board perceived the risks to be generally balanced. Additionally, they emphasized that it would take “some time” before they could express confidence in inflation returning to the target level.
Westpac’s summary of the RBA March meeting minutes echoed similar sentiments, highlighting that the current cash rate level is deemed appropriate for the prevailing circumstances, although conditions are subject to potential changes in the future.
