AUD/USD Slides after RBA’s Dovish Hike
The pair drops after its best week of the year, as the first hike since June by the Australian central bank was accompanied by a softer messaging around future moves
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The pair drops after its best week of the year, as the first hike since June by the Australian central bank was accompanied by a softer messaging around future moves
Watch today’s US Open for insights on the RBA’s dovish hike and the impact on AUD/USD, Nasdaq’s longest profitable streak of the year, key incoming earnings and more
Australia’s central bank raised rates to a 22-year high after four straight holds and raised its inflation forecasts, but also softened its language around the possibility of further moves
The jobs data on Friday has affected the real yield and this, in turn, has filtered through to other instruments. The non-farm employment change printed at 150K, which was lower than the 178K expected. Moreover, the previous print was revised lower to 297K. Average hourly earnings m/m were also lower than anticipated at 0.2% (0.3%), whilst the unemployment rate crept up to 3.9% from 3.8%.
The pair dropped after the Fed sounded more dovish than previously and the NFPs showed weakness, but finds support today, defending key tech levels
The pair rises to critical levels, building on the gains form the Fed’s dovish hold after today’s US NFPs showed the addition of just 150,000 jobs in October
The spread between the UK and US 2-year notes (top chart) remains a strong driver of GBPUSD (middle chart). The current longer correlation is an impressive 86% (bottom chart). This suggests a strong positive relationship between the spread and cable.
Watch today’s US Open for insights the two consecutive rate holds by the Bank of England and the US Fed, AMD’s return to revenue growth, key incoming events and more
Yesterday, the Federal Reserve kept interest rates on hold for a second consecutive meeting. Chair Powell recognised that inflation is slowing as opposed to emphasising how strong growth has been. Whilst keeping the door open for further hikes, there is a strong possibility that this rate hiking cycle has peaked. As such, the real yield dropped yesterday by 7.5% to close at 2.32%. It has dropped further today and is…
The pair rises past key resistances and into the Ichimoku Cloud after the Fed boost, but reaches overbought levels and now awaits next week’s live meeting by the Reserve Bank of Australia
Yesterday's European core CPI (flash estimate) came in at 4.2% y/y, which is lower than the previous 4.5 y/y, registering as a two-year low. The spread between the German and US 2-year notes also declined by about 1.5% on the day.
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