Australian dollar falls as RBA Deputy Governor Hauser recommends against basing policy on a single inflation data.
The Australian Dollar (AUD) fell against the US Dollar (USD) on Friday, possibly due to dovish comments from Reserve Bank of Australia (RBA) Deputy Governor Andrew Hauser. Hauser said it would be a “bad mistake” to base policy on a single inflation report. He stressed that there is still a suite of economic data to come. Bloomberg reports that detailed analysis will be required.
Australia’s high inflation rate has prompted speculation that the RBA may raise interest rates again in August.
The Australian dollar gained momentum with the release of May’s higher-than-expected Monthly Consumer Price Index (CPI). The continuously high inflation rate has prompted expectations that the RBA may hike interest rates again in August.
The US dollar rises due to higher yields ahead of Friday’s Core PCE inflation report.
The US Dollar (USD) strengthens due to greater rates on US Treasury bonds. Friday’s Core PCE Price Index inflation is expected to fall to 2.6% year on year from 2.8% before. This data is considered the Federal Reserve’s (Fed) favored inflation gauge.
Daily Market Movers: Australian Dollar falls due to aggressive Fed talk.
Australia’s 10-year government bond yield jumped above 4.4%, reaching a three-week high, as a scorching inflation report stoked fears that the Reserve Bank of Australia might raise interest rates again at its next meeting In August.
Michelle Bowman, a member of the Federal Reserve’s (Fed) Board of Governors, stated on Thursday that she is still hesitant to support a central bank rate cut because inflation pressures remain high. Bowman said. He added: “We are still not yet at the point where it is appropriate to lower the policy rate, and I continue to see a number of upside risks to inflation,” Reuters reported.
US Gross Domestic Product Annualized increased by 1.4% in Q1, slightly better than the prior measurement of 1.3%, but still the slowest growth since the recession in the first half of 2022.
US Initial Jobless Claims indicated on Thursday that the number of persons filing unemployment benefits dropped to 233,000.
The US Initial Jobless Claims indicated on Thursday that the number of persons filing unemployment benefits dropped to 233,000 in the week ending June 21.
Below market forecasts of 236,000. The number of claims declined for the second straight week after reaching a 10-month high of 243,000 earlier in June.
The first US presidential debate between President Joe Biden and Republican Presidential Nominee Donald Trump aired on CNN News. Biden accepted the fact that “inflation had driven prices substantially higher than at the start of his term but said he deserves credit for putting ‘things back together again’ following the coronavirus pandemic.” In response, Trump slammed high inflation rates. He said that tariffs might reduce deficits and advocated examination of countries such as China, according to Reuters.
Assistant Governor of the Reserve Bank of Australia (RBA), Christopher Kent, indicated on Wednesday that recent data highlight the importance of keeping watchful about potential inflation hikes. Kent observed that Current policies are leading to slower demand growth and reduced inflation. He also stated that no possibilities for future interest rate adjustments are being ruled out, according to Bloomberg.
Australia’s monthly Consumer Price Index (CPI) increased by 4.0% in the year to May, up from 3.6% in April, according to statistics released by the Australian Bureau of Statistics (ABS) on Wednesday. This gain outperformed the market projection of 3.8% growth for the given period.
