Ivan Delgado
Independent Analyst
The Aussie dollar has been smashed in the past 15 hours.
Since trading up to 0.8026 in early European trade it has since crashed by a little less than a cent and a half and sits at 0.7890 as I write.
What’s behind the crash is a renewed focus on the chances of a rate cut after noted RBA watcher Terry McCrann wrote an article overnight which said the RBA is downgrading its inflation and economic growth forecasts in preparation for the release of the quarterly Statement on Monetary Policy Friday week.
McCrann is less certain they WILL cut next Tuesday but certainly leans that way.
Also out overnight was the RBNZ which reversed its previous hawkish outlook to such an extent that the market is now pricing an 80% chance of a rate CUT – yes cut – this year.
Also weighing on the Aussie is the big crash in oil overnight, which dipped more than 4% and the big selloff into the close of trade in US stocks which are getting very close to the 1,985/90 support zone for the S&P 500.
It’s not a great morning for the Aussie – it hasn’t taken out last week’s low and support is 78 and then 76 cents
Since trading up to 0.8026 in early European trade it has since crashed by a little less than a cent and a half and sits at 0.7890 as I write.
What’s behind the crash is a renewed focus on the chances of a rate cut after noted RBA watcher Terry McCrann wrote an article overnight which said the RBA is downgrading its inflation and economic growth forecasts in preparation for the release of the quarterly Statement on Monetary Policy Friday week.
McCrann is less certain they WILL cut next Tuesday but certainly leans that way.
Also out overnight was the RBNZ which reversed its previous hawkish outlook to such an extent that the market is now pricing an 80% chance of a rate CUT – yes cut – this year.
Also weighing on the Aussie is the big crash in oil overnight, which dipped more than 4% and the big selloff into the close of trade in US stocks which are getting very close to the 1,985/90 support zone for the S&P 500.
It’s not a great morning for the Aussie – it hasn’t taken out last week’s low and support is 78 and then 76 cents
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