Australian dollar calm after RBA minutes Somoybulletin

[ad_1]

  • RBA releases minutes
  • Investors eye Israel-Hamas war

The Australian dollar has extended its gains on Tuesday. AUD/USD is trading at 0.6353 in Europe, up 0.18%.

It has been a rough patch for the Australian dollar lately. The Aussie hasn’t managed a winning week since September and dropped close to a one-year low last week. The Australian dollar has rebounded this week, gaining close to 1%, as the US dollar has lost some steam.

We’ve been hearing a lot about the Fed’s “higher for longer” stance and the markets are less confident that the Fed is done with the current tightening cycle than they were a few months ago. The fighting in the Middle East has created a new “higher for longer” in terms of uncertainty, which could result in elevated volatility in the currency markets.

The US dollar, a trusted safe-haven asset, has not benefited from the latest turmoil in the Middle East, at least not yet. There is widespread concern that the Israel-Hamas war could spread to Lebanon and even to Iran. The US is determined to halt any contagion and has dispatched aircraft carriers to the region.

The Reserve Bank of Australia released the minutes of this month’s meeting earlier today. The central bank held rates at 4.10% for a fourth straight time, but the minutes showed that there was consideration to raise rates by a quarter-point.

The board members noted that inflation was well above the 2%-3% target and “was expected to do so for some time”, with rising fuel prices adding to headline inflation. The minutes noted that the current tightening cycle continued to filter through the economy and the full effects were yet to be felt.

The RBA meets next on November 3rd and members will have plenty of data to chew on ahead of the rate decision. Australia releases an employment report on Thursday, inflation next week and economic forecasts prior to the meeting. The RBA has said that rate decisions will be data-dependent, and these releases will determine whether the RBA extends its pause phase or delivers a rate hike.

.

AUD/USD Technical

With the Australian dollar showing limited movement, the support and resistance levels are unchanged from Monday:

  • AUD/USD continues to test resistance at 0.6343. Above, there is resistance at 0.6399
  • 0.6240 and 0.6184 are providing support

 

Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at [email protected]. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.



[ad_2]
Source link

Leave a Reply

Your email address will not be published. Required fields are marked *