Australian Dollar trades lower as RBA minutes draw attention

• Aussie mildly declined to 0.6250 on Monday trading on a tight range.
• Market eyes upcoming RBA minutes for policy clues.
• Any RBA dovish hint could push the pair even lower.

The Australian Dollar trades in a tight range around 0.6250 as investors look ahead to Tuesday's Reserve Bank of Australia (RBA) minutes. Markets remain focused on whether the central bank will confirm a dovish bias after its December hold. Meanwhile, soft economic data and global uncertainties keep the Aussie under modest selling pressure.

Daily digest market movers: Aussie steady with RBA minutes in focus

• The AUD/USD pair remains range-bound on Monday following the RBA's decision to keep the Official Cash Rate at 4.35% in December.
• Speculation about a 25 basis points rate cut in February persists, with market odds at 65% and a full pricing in by April.
• Investors will monitor the RBA officials' stances and their confidence on the progress of inflation.
• Any dovish hint which makes investors bet on a cut in Q1 of 2025 might significantly hurt the Aussie.
• Previous statements hinted at rate hikes but omitted "ruling anything in or out".
• RBA expressed optimism, stating inflation is "moving sustainably towards target," signaling progress toward their goals.
• Markets interpreted the RBA's tone as dovish despite Governor Bullock's emphasis on data-driven February rate decisions.

AUD/USD technical outlook: Aussie pauses after two-day winning streak

The AUD/USD mildly declined to 0.6245 on Monday, snapping its brief recovery. The Relative Strength Index (RSI) stands at 30, dipping further into near-oversold territory. Meanwhile, the Moving Average Convergence Divergence (MACD) histogram prints flat red bars, suggesting waning bearish momentum. Although the pair's selling traction seems limited, any upside may hinge on the RBA minutes clarifying the likelihood of a February rate cut.