AUD/USD inter-market: Out of sync with Copper, dumped on dovish RBA minutes

Having dived from two-month tops on Friday, the AUD/USD pair finally brought an end to its recent bullish run and came under fresh selling pressure this Tuesday, following the release of less upbeat/ dovish RBA minutes released earlier on the day.

The RBA minutes highlighted "awaiting updated staff forecasts for August review", which suggests that August meeting is very much a live meeting for further rate cut. Moreover, the policy statement was read downbeat on certain sectors of the economy. The employment growth was described as having "moderated", while the housing market was also described as mixed.

Moreover, a poor risk environment triggered by tumbling European equities, further added to the slump in the Aussie. Risk trends, gauged by the CBOE Volatility index
(VIX) rebounds sharply from multi-month lows and now nears 13 handle, up 3% on the day. Higher VIX suggests that uncertainty and panic persists in the markets, which weighs heavily on the higher-yielding currencies such as the AUD.

Amongst the other intrinsics justifying the latest downfall in the major, the yield differentials between the US 10-year treasuries yields and its Australian counterpart continue to favour the greenback. While the Aussie and copper prices trade in separate direction, and completely out of sync. At the time of writing, AUD/USD plunges -1.30% to fresh weekly lows of 0.7490, while copper prices on COMEX rise +0.58% to 2.25 levels.