AUDUSD soars to near 0.6550 as RBA Bullock prepares to raise interest rates further if necessary.
During Thursday’s European session, the AUDUSD pair rose to around 0.6550. The Australian dollar strengthens as Reserve Bank of Australia (RBA) Governor Michelle Bullock issues hawkish interest rate advice.
The Fed is likely to cut interest rates substantially in response to concerns about a potential US downturn.
The US dollar (USD) corrects on firm Federal Reserve (Fed) rate-cut chances.
Michelle Bullock stated in the Q&A session at Thursday’s Rotary Club of Armidale Annual Lecture that the board will not hesitate to raise the Official Cash Rate (OCR) further If necessary. She also stated that the central bank will remain alert against inflation concerns. When asked about the inflation prospects, Bullock responded. “Don’t expect to be back in 2-3% target range until end of 2025.”
Meanwhile, market mood remains risk-averse due to expectations of a worldwide slowdown. S&P 500 futures have lost some ground in the European session. The US Dollar Index (DXY), which measures the value of the US dollar against six major currencies, has fallen to around 103.00.
The US Dollar’s near-term outlook remains murky, with market expectations that the Federal Reserve (Fed) will adopt an aggressive policy-easing approach. In contrast, Goldman Sachs economists noted in a report, “So while market stress is substantially higher than a week ago, our Financial Stress Index (FSI) indicates that there have been no significant market disruptions that would require policymakers to intervene.”
Investors are waiting for weekly unemployment claims data in the United States.
In Thursday’s session, investors will look for the United States Initial Jobless Claims data for the week ending August 2 to learn more about the present state of the job market, which will be released at 12:30 GMT. Economists predict that 240K people claimed unemployment benefits for the first time, a decrease from the previous release of 249K.
https://voiceoftraders.com/analysis/gbpusd-defends-100-day-sma-despite-minor-usd-decline
