Forex Today: After a quiet day attention turns to FOMC minutes

During the Asian session, Australian activity data is due, as well as the Chinese Caixin Services PMI. The final European PMI readings are also due, along with the Eurozone Producer Price Index. Later in the day, the Federal Reserve will release the minutes of its latest meeting.

Here is what you need to know on Wednesday, July 5:

On a quiet day due to a holiday in the US, the US dollar posted mixed results. Commodity currencies were the top performers. Markets await new information, and volatility is set to pick up on Wednesday with the release of the FOMC minutes. Then, the focus will turn to US labor market data with the ADP report, JOLTS, and Jobless Claims on Thursday, and on Friday, with the Nonfarm Payrolls report.

The US Dollar Index rose above 103.00, boosted only by the decline of the EUR/USD, which fell under 1.0900. The Euro was the worst performer among majors. On Wednesday, the final reading of June PMIs is due in the Eurozone, as well as the June Producer Price Index (PPI).

GBP/USD rose modestly and held above 1.2700 while EUR/GBP resumed its decline, falling toward 0.8550 and posting the lowest close in two weeks.

USD/JPY moved sideways around 144.50 in a tight range. The Yen benefited from a modest decline in European stocks and as European bond yields pulled back moderately.

AUD/USD recovered on Tuesday after a slide that followed the Reserve Bank of Australia's (RBA) decision to keep rates unchanged. The pair bottomed at 0.6641 and then rebounded, reaching levels above 0.6700. On Wednesday, the AIG Manufacturing Index is due, as well as the final Global Services PMI.

TD Securities on RBA: 

We retain our call for the RBA to hike in August. However, calls beyond that will be more data dependent and based on today's Statement suggest an upside surprise in inflation will be required to bring the RBA back to the hiking table after that. At this stage the risk to our 4.85% call is that the tightening cycle is drawn out rather than the RBA calling it a day on rate hikes.

The kiwi was among the top performers, with AUD/NZD hitting one-month lows after the RBA decision, falling below 1.0800. NZD/USD rose for the third consecutive day and posted the strongest daily close in two weeks, slightly below 0.6200 and above key daily simple moving averages.

USD/CAD dropped on Tuesday but found support above 1.3200. The weaker dollar and a recovery in crude oil prices after Saudi Arabia and Russia's output cut favored the Loonie.

Metals rose modestly on Tuesday, with Gold testing levels above $1,930 but again failing to hold above and pulling back. Silver continues to be limited by the $23.00 area.