AUDUSD: Potential for renewed declines on global growth concerns – MUFG

FXStreet Insights Team FXStreet

AUD/USD has been unable to advance on the back of the Reserve Bank of Australia’s (RBA’s) 50 bps rate hike. Amid global recessionary risks, economists at MUFG Bank expect the aussie to move downward.

RBA action fails to lift aussie

“RBA has taken the official policy rate to 1.35%, the highest since May 2019 and the first-ever back-to-back 50 bps hike. Around 40 bps of tightening is currently priced for the August meeting and 175 bps through the five remaining meetings this year. As is our view for the Fed and other major central banks, we do not expect the RBA to hike through the remainder of the year.”

“We maintain that risks for AUD are to the downside. The global growth outlook is deteriorating and the fact that AUD/USD is now lower on the day after a 50 bps rate hike underlines the potential over the near-term for renewed declines on global growth concerns.”

See: AUDUSD to remain under pressure for now as recession fears linger – Commerzbank

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

EUR/USD treads water above 1.1850 amid thin trading

EUR/USD stays defensive but holds 1.1850 amid quiet markets in the European hours on Monday. The US Dollar is struggling for direction due to thin liquidity conditions as US markets are closed in observance of Presidents' Day.

GBP/USD flat lines as traders await key UK and US macro data

GBP/USD kicks off a new week on a subdued note and oscillates in a narrow range near 1.365 in Monday's European trading. The mixed fundamental backdrop warrants some caution for aggressive traders as the market focus now shifts to this week's important releases from the UK and the US.

Gold sticks to intraday losses; lacks follow-through

Gold remains depressed through the early European session on Monday, though it has managed to rebound from the daily trough and currently trades around the $5,000 psychological mark. Moreover, a combination of supporting factors warrants some caution for aggressive bearish traders, and before positioning for deeper losses.

Bitcoin, Ethereum and Ripple consolidate within key ranges as selling pressure eases

Bitcoin and Ethereum prices have been trading sideways within key ranges following the massive correction. Meanwhile, XRP recovers slightly, breaking above the key resistance zone. The top three cryptocurrencies hint at a potential short-term recovery, with momentum indicators showing fading bearish signs.

Global inflation watch: Signs of cooling services inflation

Realized inflation landed close to expectations in January, as negative base effects weighed on the annual rates. Remaining sticky inflation is largely explained by services, while tariff-driven goods inflation remains limited even in the US.

Ripple Price Forecast: XRP potential bottom could be in sight

Ripple edges up above the intraday low of $1.35 at the time of writing on Friday amid mixed price actions across the crypto market. The remittance token failed to hold support at $1.40 the previous day, reflecting risk-off sentiment amid a decline in retail and institutional sentiment.