Subscribe to RSS

Australian Dollar to Filter Risk Trends Impact Through RBA Rhetoric

Australian Dollar to Filter Risk Trends Impact Through RBA Rhetoric


Fundamental Forecast for the Australian Dollar: Neutral

  • RBA Comments to Gauge the Impact of Risk Selloff on Rate Cut Bets
  • Supportive US News-Flow May Prove Negative for Risk Sentiment
  • Find Key Turning Points for the Australian Dollar with DailyFX SSI

The Australian Dollar finished last week with the worst performance in seven months, dropping over 2 percent against its top counterparts as market-wide risk aversion weighed on the sentiment-linked currency. The rout across emerging-market assets and global equities had rekindled speculation that the RBA will need to embark on further monetary easing. Indeed, a measure tracking the priced-in outlook for benchmark lending rate dropped to the lowest level in nearly two months last week and now calls for at least one 25 basis point cut in the next 12 months.

In the week ahead, comments from RBA Governor Glenn Stevens will put this interpretation of the selloff to the test. The central bank chief is due to speak at the National Reform summit organized by The Australian and The Australian Financial Review newspapers next week. He will almost certainly comment on the impact of the slump across global exchanges on Australia’s own fortunes and the possibility that negative spillover will beckon additional policy support.

Rhetoric suggesting that officials are being made uneasy by recent developments and have started to ponder the need to reduce borrowing costs further is likely to weigh heavily on the Aussie Dollar, whereas a sanguine posture could offer a degree of support. The former scenario seems likely to inspire greater follow-through however. Central bankers typically take a longer view of economic trends than financial markets so investors are unlikely to be meaningfully surprised if Stevens opts for a wait-and-see approach. On the other hand, a palpable dovish done shift would imply the RBA sees lasting headwinds ahead.

On the external front, US economic news-flow takes top billing as home sales, consumer confidence and updated GDP figures cross the wires. As before, the outcomes are likely to be judged in terms of their implications for the likely timing of the Fed’s first post-QE interest rate hike. Improvements are expected across the board, but the implications of such outcomes may prove somewhat counter-intuitive.

The markets have interpreted recent risk aversion as likely to delay tightening, with the priced-in outlook for the year-end standing of the Fed Funds rate falling alongside the S&P 500. This hints that while a stronger US economy amounts to broadly good news for global output, the possibility that upbeat data encourages the Fed to begin withdrawing stimulus in an otherwise difficult environment may be seen as decidedly risk-negative. This suggests that the Aussie may suffer if upbeat US data prints on the strong side. With that said, the possibility that firmer figures are on-boarded as supportive for sentiment and thereby lift the Aussie ought not be fully discounted. –IS

0 commentsback to post

Add your comment

Nickname:
E-mail:
Website:
Comment:

Other articlesgo to homepage

$1500 Startup Forex No Deposit Free Bonus – InstaForex

$1500 Startup Forex No Deposit Free Bonus – InstaForex(0)

$1500 Startup No Deposit Free Bonus to all new InstaForex Customers. The new Startup No Deposit Forex Bonus from InstaForex is an exciting opportunity to start Forex live trading. Link:  $1500 Startup No Deposit Bonus Link:  $100 Forex No Deposit Bonus 2018 Link:  Get 250% Bonus for First Deposit Link:  100% Special Deposit Bonus Campaign

FX Zones Demo Trading Forex Contest – Forex Time

FX Zones Demo Trading Forex Contest – Forex Time(0)

FX Zones Demo Trading Forex Contest Z3 Bid Central. Sharpen your forex trading skills completely RISK-FREE as you enter ForexTime (FXTM) Broker simulated forex world of 2017 the FX Zones. Link:  FX Zones Demo Trading Contest Link:  $25 Per Referral Earn up to $10000 Link:  Receive $30 Tradeable Credit Bonus Link:  Loyalty Cashback Promotions Link: 

$123 Welcome Forex No Deposit Free Bonus – FBS

$123 Welcome Forex No Deposit Free Bonus – FBS(0)

$123 Welcome Forex No Deposit Bonus for an ultimate start on the Forex market. $123 Free No Deposit Bonus funds are available for forex trading within 7 calendar days after the account opening. Link:  $123 Free Special Bonus Promotion Link:  100% Deposit Bonus Promotion Link:  $88.8 Lucky No Deposit Required Bonus (for Malaysian traders) Available

Monthly Live Trading Contest win up to $1000 – Tickmill

Monthly Live Trading Contest win up to $1000 – Tickmill(0)

Forex Monthly Live Trading Contest. Put your forex trading skills to test and win up to $1000 every Month! Forex Live Trading Contest is only available for clients of Tickmill Ltd.(FSA Regulated) Link:  Weekly Demo Race Trading Contest Link:  $30 Free Welcome Bonus Offer Link:  Forex Monthly Live Trading Contest Available to: All new traders

Up to 200% Withdrawable Cashback Rebates – ForexTime

Up to 200% Withdrawable Cashback Rebates – ForexTime(0)

Forget Loyalty Points, ForexTime Rewards Loyalty in Up to 200% Withdrawable Cashback Rebates Bonus and get $4 Cashback back for every lot you trade. Link:  Receive $30 Tradeable Credit Bonus Link:  FX Circuits Live Trading Contest Link:  Demo Forex Trading Contest Link:  Loyalty Cashback Promotions Link:  200% Withdraw able Cashback Rebates Ending Date: 31 December

Get $50 Free Bonus Start Forex Trading Bitcoin – UFX

Get $50 Free Bonus Start Forex Trading Bitcoin – UFX(0)

Get a $50 Free Bonus Start Forex Trading Bitcoin with UFX. Forex Trading Bitcoin with UFX is simple and gives you the opportunity to increase your return whether BTC prices RISE or FALL Link:  $50 No Deposit Bonus Promotion Link:  $50 Free No Deposit Bitcoin Bonus Link:  Halloween Trick or Trade Competition Link:  100% Real

Up to $1000 Forex Deposit Bonus Promotion – FortFS

Up to $1000 Forex Deposit Bonus Promotion – FortFS(0)

Up to 50% Forex Bonus of Every Deposit to All New and Existing Traders. You Deposited $1000 on your account, chose a 50% forex bonus and got 500 extra dollars to the initial deposit amount. Link: Up to 50% Bonus of Every Deposit Link: $5 Forex No Deposit Welcome Bonus Link: 15% Support Margin Bonus

FX Circuits Live Forex Trading Contest – Forex Time

FX Circuits Live Forex Trading Contest – Forex Time(0)

ForexTime latest Live Contest Win cash prizes from a $400,000 total prize pool. FX Circuits rewarding clients with real, withdrawable from a $400000 total prize pool.* Link:  FX Circuits Live Trading Contest Link:  Demo Forex Trading Contest Link:  Loyalty Cashback Promotions Link:  200% Withdraw able Cashback Rebates Available to:   New Clients only Contest Offer: ForexTime

20% Unlimited Bonus on Your First Deposit – FidelisCM

20% Unlimited Bonus on Your First Deposit – FidelisCM(0)

20% Unlimited Bonus On Your First Deposit to All new traders. If you have a $30 Deposit Account with FidelisCM then add wings to your ambitions and receive a 20% Tradable Bonus Link:  20% Bonus On Your First Deposit Available to: All new traders Ending Date: 30 June 2017 Bonus Offer: Get 20% Unlimited Bonus

100% Real Money Cash-Back Bonus Promotion – UFX

100% Real Money Cash-Back Bonus Promotion – UFX(0)

100% Real Money Forex CashBack Promotion to all new and existing clients. Join and gain exclusive access to the ONLY online trading 100% Forex Cashback rewards bonus program Link:  $5000 BitCoin Rewards Bonus Promo Link:  $50 Forex No Deposit Special Bonus Link:  $50 Free No Deposit Bitcoin Bonus Link:  100% Real Money CashBack Promotion Bonus

read more

Forex Featured Broker

Contacts and information

ForexDepositNews.com Forex Deposit Bonus, Forex No Deposit Bonus, Forex Live Contest, Forex Demo Contest, Free Forex Bonus Forex Brokers Review and Other All Forex promotions.

ForexDepositNews.com

Social networks

Most popular categories