AUD/JPY skids below 85.00 ahead of RBA meeting minutes

• AUD/JPY has slipped below 85.00 as investors await fresh impetus from China’s aid to Russia.
• Japan’s economy is hurting from galloping commodity prices.
• Investors will focus on BOJ’s interest rate decision later this week.

The AUD/JPY pair has slipped below the round level of 85.00 as investors are waiting for the Reserve Bank of Australia (RBA)’s minutes from March’s meeting. The minutes from the RBA’s March meet will display the rationale behind the status quo maintained by the RBA’s Chair Philip Lowe and his colleagues. The risk barometer has performed well in the past few trading sessions on Japan’s pain due to the rising prices of commodities.

The escalation in the Russia-Ukraine war has drifted the prices of oil, metals, and grains. This has significantly hurt the Japanese yen against the aussie. The former is a major importer of all these mentioned commodities and its fiscal policy is facing the heat of rising prices. While, the antipodean is a major exporter of iron ore, coal, and other metals and expensive commodities are bringing more flows for it.

It is worth mentioning that the RBA has not followed the footprints of other central banks and is holding its cash rate at a record low of 0.1% for the 15th month in a row during its March 2022 meeting. Meanwhile, the monetary policy from the Bank of Japan (BOJ) is due later this week. The BOJ is more likely to keep the interest rate unchanged at 0.1% despite the rising prices of commodities.

Apart from the events associated with BOJ and RBA, investors will focus on the story of China’s support to Russia. The US has claimed that Russia has requested China to provide military support against Ukraine. Although, China has denied any kind of intimation by Moscow regarding the military aid. Any positive development over the headlines will hurt the antipodean as Australia is a leading trading partner of China.