The Australian dollar displayed a resilient rebound in the European session which rose from 0.7007 to 0.7068 ( 61 pips) against the US dollar on the price action of both short-covering with the AUDJPY rebound which rose from 83.60 to 84.80 ( 120 pips) as the yen weakened on BOJ's Kuroda comment: "No limit to easing steps, will do whatever it takes to achieve 2% inflation goal."
The Australian dollar fell from the late NY session high of 0.7055 to the opening Asian session of 0.7025 on extended selling interest stemming from the dovish statement of the RBA yesterday. The RBA left the door open to the possiblity of more easing of monetary policy.
The wider than expected Trade Balance prompted a small knee-jerk reaction for the aussie which rose to 0.7045 from 0.7038, before falling steadily to the intraday low of 0.7003 (-42 pips) 25 minutes after the release of the trade data. The December Building Approvals was largely ignored by the market, despite the better than expected number.
Australia's December Trade Balance widened to -A$ 3.5 Billion versus the median forecast of -A$ 2.9 Billion. The December Dwelling Approvals rose to 9.2% versus the median forecast of 5.0%, better than expected.