Australian Dollar is attempting to end a three-day losing trend.
The Australian Dollar (AUD) seeks to end a three-day losing trend against the weakening US Dollar (USD), which could be ascribed to lower US Treasury yields. However, the AUDUSD pair fell as the Reserve Bank of Australia (RBA) issued a dovish rate statement following the policy decision.
Australian central bank issued a dovish rate statement, which weighed on the AUD.
In response to the continuous problems posed by inflation and a slowing Australian economy, Australia’s central bank has adopted a data-driven policy. The RBA’s emphasized this strategy. The decision to boost the Official Cash Rate (OCR) from 4.10% to 4.35%, a 12-year high, was made on Tuesday. The move was made in direct response to the most recent inflation figures, which showed a 5.6% monthly increase.
The AUDUSD pair faces problems this week in a sluggish market environment, with investors waiting for new signs before making any moves, particularly in view of the approaching US Federal Reserve (Fed) decision in December.
As Fed officials dispute the idea of decreasing interest rates, investors adopt a cautious approach.
Fed officials are resisting the idea of decreasing interest rates, therefore the mood is cautious. Investors will most likely be looking for potential market impact in the upcoming weekly US Jobless Claims report. Market players are also looking forward to hearing from Federal Reserve Chair Jerome Powell. Who is slated to participate in a panel discussion later under the title “Monetary Challenges in a Global Economy.”
Daily Digest Market Movers: The Australian Dollar aims to end its losing streak on a negative note. Greenback
After keeping the benchmark interest rate constant for four consecutive meetings. The RBA has resumed policy tightening by lifting the Official Cash Rate (OCR) from 4.10% to 4.35%.
In September, Australia’s TD Securities Inflation (YoY) decreased to 5.1% from 5.7% the previous month.
Retail sales in Australia increased by 0.2% in the third quarter. After falling by 0.6% the previous quarter.
Following the release of Q4 inflation figures, economists at the National Australia Bank (NAB) predict another 25 basis point boost in February. Furthermore, NAB predicts that rate reduction will not begin until November 2024.
In China, the Consumer Price Index (CPI) fell 0.2% year on year. October, vs the predicted 0.1% drop. The monthly CPI fell by 0.1%, contrasted with the previous 0.2% increase.
Moreover Pan Gongsheng, Governor of the People’s Bank of China (PBOC), voiced optimism in a statement on Wednesday, stating that China’s economy is on a constructive path and that the 5% growth objective will be met successfully.
Furthermore, the International Monetary Fund (IMF) has revised its forecast for China’s GDP growth, now expecting 5.4% growth in 2023, up from 5.0% previously, and 4.6% in 2024, exceeding the previous estimate of 4.2%.
Fed Governor Michelle Bowman reiterated the Fed’s intention to raise short-term interest rates in the future. Furthermore, Neil Kashkari, the President of the Minnesota Fed was questioned about whether it had raised interest rates appropriately. Kashkari noted the economy’s durability as shaping his viewpoint.
Furthermore The US Bureau of Labor Statistics just released the Nonfarm Payrolls (NFP) figures for October, revealing a 150K job increase. This fell short of the predicted 180K and was a significant dip from September’s 297K.
