Moody’s downgraded Japan’s credit rating

•      Reserve Bank of Australia remains on hold

•      RBA kept the official cash rate unchanged at 2.50%, as was widely expected.

•      They repeated that the exchange rate “remains above most estimates of its fundamental value.”

•      Unlike in their previous statement they seemed less confident that inflation will continue to run between their 2%-3% target. The change in their stance may be attributed to the lower oil prices.

•      On the other hand, they kept their concerns over the labor market.

•      As for the country’s data releases current account balance narrowed a bit in Q3 while building approvals rebounded strongly in October. Both releases exceeded estimates, yet with limited impact on AUD.

•      With no other major economic releases overnight, USD remained subdued against most of its peers.

•      It was lower the most against NOK and CAD, which gained following the moderate rebound in oil prices. 

•      On Monday, Moody’s downgraded Japan’s credit rating citing heightened uncertainty over the country’s ability to cut its fiscal deficit

•      Today:

•      Eurozone: PPI for October is expected to fall at a decelerating pace indicating however that the deflation risk persists in the region.

•      UK: Construction PMI for November.

•      Speakers: Fed Chair Janet Yellen speaks (no Q&A), Fed Vice Chairman Stanley Fischer speaks again.