In this Asia Focus Video Andrew Robinson, Correspondent for Saxo Capital Markets in Singapore analyses the stance of central banks in Australia and Japan regarding their economies.

At the December 6 Reserve Bank of Australia meeting interest rates were cut for the second consecutive month. In the minutes published this week it can now be concluded that the cut was primarily due to the slowdown in Europe and the uncertainties this creates for many economies including the distant Australian. For now the Australian economy is performing at trend though and investments are continuing, mainly in the mining sector. The minutes however were somewhat dovish leading to an interpretation that more cuts might just be on the way sometime in the New Year, says Andrew. The wait though will probably be quite long as the next RBA meeting is not until February 7. A lot can happen to the European situation and China before then so it’s really a wait and see what the macro data has to offer approach, adds Andrew.

In terms of the Bank of Japan’s meeting ahead of Christmas the focus will be on more efforts to weaken the yen and comments to that effect, particularly after the so-called “war chest” for intervention has been increased by 30 trn yen, adds Andrew. Trade data for November out this week is also of interest with the deficit seen widening largely due to the continued decline in shipments to China. Any positive effect for Japanese exporters from further yen intervention is seen as only temporary though as the global slowdown continues, he says.

See more of Andrew's Asian market commentary on TradingFloor.com