The Australian dollar flipped to a loss and the nation's three-year bond yield turned negative after the Reserve Bank left its key rate unchanged to assess the impact of its yearlong tightening cycle.
AUD/USD slid as much 0.5% to 0.6642 before paring the move slightly to 0.6655 while the three-year bond yield was little changed after rising as much as 10 basis points earlier.
Further declines in the Aussie were capped as the RBA said further monetary policy tightening may be required to ensure that inflation returns to target. Early pricing for the August meeting sees 44% chance of a 25 basis point hike.
USD/JPY little changed at 144.66; FX pair had touched 145.07 on Friday, the highest since November.
The Bloomberg Dollar Spot Index is steady while trading in cash Treasuries was closed on Tuesday for Independence Day holiday in the US.
Source: Bloomberg
