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DailyBubble News

AUD/USD stabilizes near 0.6600 albeit uncertainty ahead of US CPI and Fed’s decision

The AUD/USD pair is holding steady just below the 0.6600 level, with uncertainty looming over its outlook. The Federal Reserve is expected to keep interest rates unchanged for the seventh consecutive time. The Australian Dollar’s movements will be influenced by upcoming Employment data.

In the current market environment, the US Dollar remains strong as investors await the US Consumer Price Index data for May and the Fed’s monetary policy announcement. The S&P 500 opens on a bearish note, with 10-year US Treasury yields slightly dropping but still showing a strong recovery. The US Dollar Index continues to climb towards the monthly high.

Investors are anticipating the Fed to maintain interest rates as they battle against persistent inflation. Rate cuts are not on the table until inflation reaches the desired 2% rate. The upcoming US CPI data for May will provide insight into the current inflation status.

On the Australian front, the Employment data for May will be crucial. Expectations are for an increase of 27.5K in fresh payrolls, following April’s hiring of 38.5K new workers. The Unemployment Rate is projected to decrease to 4.0%. This data will impact market speculation on potential rate cuts by the Reserve Bank of Australia.

Currently, market sentiment leans towards the RBA keeping interest rates unchanged for the year. RBA Governor Michele Bullock’s comments have strengthened this belief, suggesting a willingness to raise rates if inflation remains below the target range of 1%-3%.

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