The New Zealand interest rate is announced on Wednesday at 03:00 MT time.
High chances of a rate cut by the RBA
The Reserve bank of Australia will release the rate statement and announce the update on the interest rate on February 4, at 5:30 MT time.
Instruments to trade: AUD/USD, AUD/JPY, AUD/CHF, AUD/NZD
The market expects the RBA to cut its interest rate from 0.75% to 0.5% during the February meeting. What may drive the central bank to do so? Firstly, it is the inflation rate. Despite an upbeat CPI released last week, the level remains below the RBA target. Thus, the bank may need to take accommodative measures. At the same time, the unemployment level remains pretty high at 5.1%. Let's not forget other risks including bushfires in Australia and coronavirus. Both of them are proven to have a great impact on the economy. That is why the Australian regulator may take some serious steps to support the economy of the country. As a rule, the shift towards more easing will weaken the Australian dollar.
• If the RBA cuts its interest rate, the AUD will fall;
• If the RBA keeps the interest rate unchanged, the AUD will rise.
The Australian Monetary Policy Meeting Minutes are announced on Tuesday at 04:30 MT time.
The Reserve Bank of New Zealand made announcements regarding its monetary policy. The NZD/USD dropped.
The European Central Bank will publish the monetary policy statement with the interest rate decision on January 21, at 14:45 MT time.
Joe Biden is going to unveil a Covid-19 relief package of about $2 trillion. After this announcement, the 10-year Treasury yield rose, adding support for the USD.
The US dollar’s weakness offered a boost to emerging-market currencies and oil.