The Australian dollar fell after the Reserve Bank of Australia’s policy meeting. Safe haven assets such as the yen and gold were some of the best performers in a broadly risk averse environment in the markets today, as investors were being cautious ahead of major risk events later in the week.

The RBA kept the cash rate unchanged at 1.50% after a policy meeting today, as was widely expected. The Bank’s statement raised concerns about the overheated domestic housing market but policymakers were also worried about the labour market, which was the main reason not to hike rates. The aussie dropped to a three-week low of $0.7561. RBA Governor Philip Lowe is due to speak later today. His speech would be interesting to watch.

The US dollar was weaker today mainly due to the narrowing of US and Japan interest rate differentials, as the yield on the US 10-year Treasury note was eased lower while the yield on Japan’s benchmark JGB yield edged higher. Relatively strong US economic data on the manufacturing and construction sectors that were released on Monday, failed to strengthen the dollar.

Meanwhile, investors are positioning ahead of the US jobs report which is due on Friday, as well as the meeting between President Donald Trump and China’s President Xi Jinping later this week. All eyes will also be on the release of the minutes of the latest Federal Reserve meeting on Wednesday, for clues about the US central bank’s outlook on interest rates.

Against the yen, the greenback slid to 110.32, the lowest since March 28.

The euro was little changed against the dollar, remaining around $1.0660. The single currency has shown lack of clear direction following last week’s tumble when markets changed their previous relatively positive views of the ECB’s potential policy path on rate hikes.

ECB President Mario Draghi’s speech later in the day will be closely watched.

In commodities, gold benefitted from safe haven flows and a softer dollar. It rose for a third consecutive day to $1,257.85 an ounce, reaching a one-week high.

WTO oil slipped to briefly dip below the key $50 a barrel level today after falling 0.7% yesterday.

Economic data releases ahead include UK construction PMI, Eurozone retail sales and trade balance data out of the US and Canada.

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