The Reserve Bank of Australia left its Cash Rate unchanged at 4.35%.
- In its policy meeting earlier today, the RBA stated that inflation remained too high to justify rate cuts, and therefore left its Cash Rate steady at 4.35%. The Aussie reacted little to this news as it was widely expected. Over the medium-term this may position the Aussie as one of the stronger major currencies if risk sentiment remains positive.
- Risk-on sentiment continues to dominate markets, getting perhaps an extra fillip today as several members of the Federal Reserve made public remarks to the effect that a large 0.50% rate cut could be appropriate at the Fed’s next meeting in early November. Stock markets are bullish, with the S&P 500 Index closing at a new record high price. The standout asset as the week gets underway is Gold, which again made a new record high price yesterday.
- Many commodities, notably Crude Oil but also some softs, are looking much stronger with the improvement in risk sentiment over the past few days.
- In the Forex market, the Canadian Dollar has been the strongest major currency since the Tokyo open today, while the Japanese Yen has been the weakest. This is in line with risk-on sentiment as the Loonie is linked to crude oil.
- Releases yesterday of high-impact Flash Services and Manufacturing PMI data in the USA, Germany, the UK, and France saw every data point come in below expectations, suggesting cooling economies in the US, the UK, and the Eurozone.
- There will be a release of Australian CPI (inflation) data early tomorrow. The annualized rate is expected to make a strong fall, from 3.5% to 2.7%.
Ready to trade our Forex daily forecast? We’ve shortlisted the best FX trading platforms in the industry for you.