Fed Chair Jerome Powell’s comments on the Jackson Hole Symposium resulted in the worst weekly candle in US500 since June.
What Will Australian Cash Rate Bring?
What will happen?
The Reserve Bank of Australia will make a statement about the cash rate on April 5, at 07:30 MT. This release comes out on every first Tuesday of a month. The cash rate is charged on overnight loans between financial intermediaries. This is a major event for AUD.
Possible AUD moves
According to the RBA last statement, the cash rate might rise if not for the obstacles that delayed it. In particular, the war in Ukraine brings more uncertainty. Despite the Australia’s economy remains resilient, inflation rose faster than the RBA expected. Nevertheless, it remains lower than in many other countries – now it’s 4%. More hawkish steps are planned for 2023.
After the March 1 release, the AUD went up. That day AUDUSD jumped by about 0.50%.
How to trade on the Australian cash rate release?
If the Actual reading is better than the Forecast, then it’s good for the currency. Therefore, a surprise rate hike will propel AUDUSD. Moreover, the AUD will get higher if the RBA is optimistic about the national economy. Conversely, if the RBA is cautious and doesn’t hint at the upcoming rate increases, the AUD will move down. Overall, not only Australia but also the other countries contemplate hawkish steps. Thus, the upcoming release is essential as the RBA may offer clues on its future decisions.
Check the Economic Calendar.
Instruments to trade: AUDUSD, AUDCHF, AUDNZD, AUDJPY
Last week several important economic updates influenced the Forex market. US preliminary GDP fell less than expected (0.6% actual vs. 0.7% forecast). Below you will find the key events to trade on during the week from August 29 to September 2.
The United States will publish the Inflation Rate and Core Inflation Rate, also known as US CPI and Core CPI, on August 10 at 15:30 GMT+3.
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.