Australian dollar rises as RBA Governor Michele Bullock expresses hawkish views.
Following a tumultuous prior session, the Australian Dollar (AUD) continues to gain momentum. The ANZ-Roy Morgan Australian Consumer Confidence weekly survey increased to 80.8 from 76.4 the previous week, coinciding with the Reserve Bank of Australia (RBA) holding interest rates unchanged at its final meeting of the year last week. Furthermore, Westpac Consumer Confidence increased at 2.7%, down from 2.6% previously.
Bullock, Australia’s chief policymaker, stated that the RBA’s priority is to ensure a vibrant labor market in Australia.
The Governor of the Reserve Bank of Australia, Michele Bullock, voiced optimism, saying, “Don’t think we are falling behind in the inflation fight.” Bullock stressed the importance of being careful and regularly monitoring data, as well as the RBA’s commitment to preserving employment increases. The goal of the central bank is to keep inflation expectations from becoming “out of control.”
China has relaxed restrictions on three Australian beef suppliers.
China has relaxed restrictions on Australian meat imports, lifting sanctions on three meat suppliers. This encouraging outcome has the potential to increase mood and provide a lift to the Australian Dollar. However, fears of deflation in China spurred a sell-off in the AUD.
The US Dollar Index remains strong, aided by higher US Treasury yields. The high level of employment The Greenback was supported by data from the United States (US), putting downward pressure on the AUDUSD pair. A rising US Dollar (USD) dampens investor sentiment and acts as a negative for the pair.
The FOMC begins its two-day policy meeting with the expectation that interest rates will remain unchanged.
The Federal Open Market Committee (FOMC) begins its two-day monetary policy meeting on Tuesday, and it is widely expected that interest rates will remain unchanged. Market players will be watching the statement attentively for clues about likely rate hikes next year. The US Consumer Price Index (CPI) report for November will also be released on Tuesday, providing insight into prospective monetary policy trajectories.
Daily Market Movers: The Australian Dollar rises as business conditions deteriorate.
The November Business Conditions report from National Australia Bank reflects trading, profitability, and employment. Australia’s conditions improved to 9 from 13 in the previous reading.
National Australia Bank Business Confidence, which surveys current business conditions in Australia and provides insights into the broader economy’s short-term performance, fell to 9 from 2 the previous month.
The Consumer Price Index (CPI) in China fell 0.5% year on year in November, following a 0.2% drop in October. Monthly Chinese inflation declined by 0.5%, exceeding the 0.1% drop seen in October.
The Producer Price Index (PPI) in China fell 3.0% year on year in November, a larger loss than the 2.6% drop reported in October.
US Nonfarm payrolls increased by 199,000 in November, compared to a previous increase of 150,000 in October and a market projection of 180,000.
US Average hourly earnings (Year on Year) remained stable at 4.0%, in line with market expectations for November. Meanwhile, the unemployment rate fell to 3.7% from 3.9% previously.
The preliminary Michigan Consumer Sentiment Index for December was 69.4, up from 61.3 the previous month.
