Japan All Industry Activity Index (MoM) dipped from previous 0.3% to 0.2% in July

Jane Foley, Research Analyst at Rabobank, suggests that we still see risk that the RBA will cut rates again this cycle to provide insulation to the economic outlook – a view which is supported by signs that the housing market activity may at last be peaking. One factor that could slow the RBA’s trigger finger would be a continued fall in the value of Australia’s effective exchange rate. Either way we continue to see downside risks for AUD/USD towards 0.68 on a 6 mth view.