AUDUSD: More Update
Hello Investors and Traders !! The dollar extended a decline from a 20-year high, on lower than anticipated US economic data releases. The greenback slid after US consumer morale hit an all-time low, as measured by the consumer sentiment index. The reading of 50.0, missing the 50.2 forecasts, is the lowest level since the University of Michigan began compiling the data in November 1952.
The dollar dropped further yesterday and recession fears are the alleged guilty party. However, that contradicts the market narrative that hopes inflation is peaking and recession can be avoided as China is easing its recent COVID-19 lockdown restrictions.
The Reserve Bank of Australia holds its policy meeting next week and is widely expected to raise rates. In June, the RBA hiked by 0.50%, surprising the markets, which had expected a smaller move. Even with the 0.50% , the cash rate is currently only at 0.85%, meaning that the RBA will have to dramatically raise rates in order to curb inflation. In the first quarter, inflation rose to 5.1% and the RBA is predicting that inflation will rise to 6% before year’s end.
Governor Philip Lowe signalled on Friday that the RBA would not deliver a super-size 0.75% hike at next week’s meeting. Lowe said that such a move was “not on the table” and that the bank was looking at “graduated steps” at the July meeting. This means that the July meeting is live, with the RBA most likely to deliver a rate hike of 0.25% or 0.50%. There has been speculation that the cash rate could hit 4% in 2022, although some indicates that the RBA would have to implement at least one 0.75% hike to achieve that level.
Investors are keeping an eye on signs of weakness in recent economic data, which would possibly moderate interest rate hikes. But they are also concerned that it could be a sign of the onset of a difficult period of stagflation.
This is an article not Financial advice
If you have any questions please leave a comment and I will answer them
And please support this idea with your likes and comment. Thank you
The dollar dropped further yesterday and recession fears are the alleged guilty party. However, that contradicts the market narrative that hopes inflation is peaking and recession can be avoided as China is easing its recent COVID-19 lockdown restrictions.
The Reserve Bank of Australia holds its policy meeting next week and is widely expected to raise rates. In June, the RBA hiked by 0.50%, surprising the markets, which had expected a smaller move. Even with the 0.50% , the cash rate is currently only at 0.85%, meaning that the RBA will have to dramatically raise rates in order to curb inflation. In the first quarter, inflation rose to 5.1% and the RBA is predicting that inflation will rise to 6% before year’s end.
Governor Philip Lowe signalled on Friday that the RBA would not deliver a super-size 0.75% hike at next week’s meeting. Lowe said that such a move was “not on the table” and that the bank was looking at “graduated steps” at the July meeting. This means that the July meeting is live, with the RBA most likely to deliver a rate hike of 0.25% or 0.50%. There has been speculation that the cash rate could hit 4% in 2022, although some indicates that the RBA would have to implement at least one 0.75% hike to achieve that level.
Investors are keeping an eye on signs of weakness in recent economic data, which would possibly moderate interest rate hikes. But they are also concerned that it could be a sign of the onset of a difficult period of stagflation.
This is an article not Financial advice
If you have any questions please leave a comment and I will answer them
And please support this idea with your likes and comment. Thank you
관련 발행물
면책사항
이 정보와 게시물은 TradingView에서 제공하거나 보증하는 금융, 투자, 거래 또는 기타 유형의 조언이나 권고 사항을 의미하거나 구성하지 않습니다. 자세한 내용은 이용 약관을 참고하세요.