The Australian dollar held a tight range on Monday in the absence of any fresh local fundamental news to prompt a sustained move above 70 US cents.
The Aussie has had several attempts to breach this psychological barrier in the past week, but in each case the move lacked momentum in the face of a tightly fought Australian election campaign and the expectation of a further erosion in the unit's interest rate premium over the United States.
Japanese markets were also closed on Monday.
The AUD was $0.6989/984 compared with $0.6985/90 late here on Friday.
The Federal Reserve meets on Tuesday and is widely expected to lift the fed funds rate to 1.75 percent from 1.5 percent, cutting the Aussie's premium to 350 basis points from 375 basis points. It was 425 basis points earlier in the year.
Of more interest will be the Federal Open Market Committee's accompanying statement and whether or not it changes from its measured approach to tightening monetary policy given the recent run of mixed data.
"The AUD remains very much in the hands of offshore developments, with no local data slated for release and the election yet to produce anything market moving," said Macquarie Bank divisional director Geoff Bowmer..
"Any post-FOMC jump by the USD is likely to test support around $0.6930/50," he said.
The local October 9 election is expected to tie the hands of the central bank in lifting interest rates when the Reserve Bank board meets in early October even though household borrowing remains at high levels.
The election itself has yet to produce a clear winner, which markets may start to fret about as election day draws nearer.
"The election should prove to be a pretty much none event for markets provided of course there is a conclusive result, one way or another," said Commonwealth Securities chief economist Craig James.
However, a hung parliament could weigh on the Aussie post-election "for the simple reason, markets hate uncertainty," he said.
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