RBA Cut the Cash rate to 1.50% by 25bps, the market has had a very subdued reaction though, barely falling 30pips from market. I still think there should be more downside here and into the mid/low 74xx before the full fade comes in - so luckily room for retails to get in, looks like the algos were having a day off today. This is positive for any kiwi$ short...
Inline with the mixed information below, i too am undecided with what the RBA will do. There are several arguments for a cut e.g. CPI falling at an alarming rate/ strong trend; strong aussie; 1.75% high yield and likely to maintain AUD strength. But several against e.g. some of the trimmed prints show stability at 1.7%; need for more data - aussie employment...
AM 2:30GMT Ausssie Inflation prints are released these are key for determining their August Policy Decision 1. IMO a 1.0%yoy CPI print shows a further 0.3% contraction in their yearly CPI, this should be sufficient to push the RBA to cutting their OCR by 25bps, similarly a 0.3%qoq CPI will be needed in conjunction to show that inflation is growing at a slow...
FOMC Lockhart was the 4th Fed this week to imo be relatively Hawkish with his words, most notably reinforcing with the others brexits near-term stability saying "Doesn't Expect 'Brexit' to Have Near Term Impact on Economy" and " So Far 'Brexit' Reaction Largely Orderly". Most interestingly though was Lockharts view on the FOMC's positioning for future rate...
Short AUDUSD is in my top 3 FX Trades for several reasons: 1. AUD is considered a riskier G10 currency cross, so AUD trades weaker in risk-off markets, or when equities/ SPX trade lower (you can see the high correlation with SPX at the bottom of the graph). - With Brexit concurring last week, global risk has increased, this is especially the case for AUD due to...
After the poor CPI reading from Australia through the night it has added pressure for the RBA to cut interest rates in the next meeting. the pattern break out gives us a target of just above 7000 but the FOMC could cause a pull back this evening if they keep rates on hold which is likely. This pull back will hopefull find resistance at the breakout point and we...