AUD: Anticipated RBA hike looms – BNY
|Bob Savage, Head of Markets Macro Strategy at BNY, notes the Australian Dollar's potential as the Reserve Bank of Australia (RBA) is expected to hike rates this week due to rising inflation. This shift marks a significant turnaround for a G10 economy transitioning from an easing cycle to tightening. The report emphasizes the RBA's hawkish stance compared to other central banks and notes the impact on AUD trading dynamics.
RBA hike expected amid inflation concerns
"There is a strong case for an RBA hike this week, as inflation has decidedly taken a higher turn. Such a step would mark one of the fastest turnarounds for a G10 economy shifting from an easing cycle back toward hikes."
"Any marked improvement on the AUDUSD leg will be highly sensitive to any shift in relative pricing between the two central banks and change aggregate flow dynamics."
"AUD was net-bought on the crosses, which comes as no surprise given that the RBA’s hawkish pricing and the global metals complex meant AUD was highly favored on a relative value basis."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.