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How to Trade AUD after RBA Statement?
What will happen?
The Reserve Bank of Australia will announce its policy statement and gives an economic outlook on July 6 at 7:30 MT. Traders will await this event to get some clues on the outcome of the central bank’s future decisions. More and more banks are moving to a hawkish tone, but the RBA isn’t likely to join them this time as Australia experiences fresh virus outbreaks these days. Unlike the RBA, the Fed has claimed that it would cut bond buys in the coming months and raise rates earlier than initially thought. Therefore, we might expect a further weakening of the Australian dollar and strengthening of the US dollar, of course in case the RBA leaves policy unchanged.
How to trade on RBA Statement?
- If the central bank gives a positive economic outlook and hints on policy tightening sooner than 2024, the Australian dollar will rise.
- If the RBA concerns about economic growth and not ready to shift tightening earlier than 2024, the Australian dollar will fall.
Instruments to trade: AUD/USD, AUD/JPY, AUD/NZD
Main news that will drive the market in the upcoming week include CB Consumer Confidence Index, Canadian GDP, and US Core PCE Price Index
The Federal Reserve (Fed) will announce its Interest Rate Decision and make a statement about the future monetary policy on Wednesday, September 21, GMT+3. After the higher-than-expected inflation numbers published on September 13, there’s almost no doubt the Federal Reserve will come up with another 75-basis-point rate hike. However, surprised by the CPI numbers, several Fed members announced the possibility of a 100-basis-point rate hike on Wednesday.
Every week we expect many interesting events that can shake the market.