The Reserve Bank of Australia slowed its pace, raising interest rates by 25 basis points at its last meeting. AUDUSD fall to the bottom. This he needs a rhetoric change because it will not help the RBA fight inflation. Discuss topics and make trading plans.
Weekly Australian Dollar Fundamental Analysis
The market contributed to the AUD’s decline after the RBA unexpectedly slowed the pace of monetary tightening. In early October, Australian regulators raised his cash rate by 25 bps, and so far he has raised it by 50 bps four times. Once RBA officials realized what they had done, they tried to justify themselves. According to Vice Chairman Michelle Bullock, the regulator is no outsider now because she acted faster than anyone until October.
Central bank interest rate dynamics
Source: Bloomberg.
As the leader in global financial regulation, nothing good will happen to the currency. AUDUSD Easily reaching the target of 0.62 set at the end of September, the trader managed to add a short at the breakout of the 0.645 support in early October. The risk of a downtrend recovery is high and RBA officials have realized what they have done. A weaker currency is fueling inflation, with consumer prices at 6.1% already far from his 2-3% range of targets.
The RBA still has a lot of work to do, and the RBA’s intention to keep the economy going is misplaced. Australia will avoid recession due to strong domestic conditions, according to treasurer Jim Chalmers. A strong labor market and high commodity prices will help protect the economy from growing international risks. Even as the global economy storms, Australia will remain an island of silence.
The Treasury Department’s optimism is unusual as Westpac’s consumer sentiment plummets to its lowest level since the pandemic. The number of pessimists is much higher.
Australian household sentiment dynamics
Source: Bloomberg.
RBA officials say they are working hard and the Australian government is optimistic, but Australia is last. The reasons are a deterioration in commodity markets due to fears of an approaching global recession, a bearish trend in US stock indices, and her COVID-19 outbreak in China. The situation is so serious that Beijing has postponed the release of its third quarter GDP data, scaring investors.
every week AUDUSD trading plan
What is AUDUSD Outlook? The pair’s future is uncertain as the futures market expects the cash rate to rise from the current 2.6% to a cap of 3.1% and the federal funds rate to rise to 4.6% from his 3.25%. It is very likely that we will reach our long-term target of 0.6, and may even reach our previous 0.62. In this situation, the AUD should rise to $0.641 and $0.6435 or sell once it breaks out of support at $0.624 and $0.62.
AUDUSD price chart in real time mode
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