Weekly Forex Analysis

Week ahead

Dollar, goes up and down with other currencies

🇺🇸 The recent economic data for the United States has been disappointing, leading investors to reconsider the necessity of another interest rate increase by the Federal Reserve before the contractionary phase concludes, potentially followed by more rate cuts next year. Consequently, the US dollar has shown signs of weakness in the financial markets.

This week, the dollar’s calendar is relatively uneventful. If economic data from other countries is released with weak figures, it could bolster the dollar’s strength. Conversely, if this data appears weak, it may lead to a correction in the dollar’s value. In the event that both the dollar and other currencies weaken, there is likely to be increased demand for the dollar as it is perceived as a safe asset.

It’s a funny theory Dollar Smile Theory

When the future outlook is abnormal, the demand for the dollar will be checked. If it rises, the dollar will be corrected and vice versa from this week. In the past, the sentiment of the market is risk-averse and it will continue on Monday, the dollar may not correct before it changes.

After a barrage of disappointing data for the US dollar in the past week, investors are now wondering whether another rate hike by the Federal Reserve is needed.

This week, more attention will be focused on the purchasing managers’ index of the US service sector, as reported by the ISM Institute. Both the preliminary Purchasing Managers’ Index of the manufacturing sector and the services sector from the S&P Global Institute increased the market’s expectations for no increase in interest rates and even a decrease in August. Taking this issue into consideration, the possibility of a decrease in the ISM index in the next week has also increased. However, reducing the likelihood of another rate hike by the Federal Reserve will also depend on the sub-indices of new orders and prices. If we see declines in these two categories as well, the US dollar and Treasury bond yields may remain under pressure and the stock market will continue to rise, as rising expectations of interest rate cuts could reduce the net present value (NPV) of companies with good growth.

📅 Ziwox Calendar

Mixed EUR

🇪🇺 Quietly, the “stagflation” scenario is making a comeback in discussions about the Eurozone’s economic future. The European Central Bank (ECB) has acknowledged that economic growth will be much weaker than their initial forecasts, and core inflation remains stubbornly above 5%. The ECB is expected to maintain its planned 0.25% rate hike at the September meeting, but some believe this could be a mistake.

Meanwhile, eurozone leaders are still considering whether to reinstate the Maastricht debt and deficit measures that were temporarily suspended during the pandemic. While this move might benefit government bond markets in the eurozone, it could have a negative impact on the euro due to less expansionary monetary policies and more contractionary fiscal policies. Prior to the pandemic, there were discussions about keeping the budget deficit below 3% of GDP.

This week, no important data will be released for the Eurozone.

Bank of England Decision Survey

🇬🇧 The Office for National Statistics (ONS), which is Britain’s national data office, provided assistance to UK policymakers on Friday. They revised the GDP growth for 2021 to 1.7%. This indicates that the UK has achieved pre-pandemic growth earlier than previously estimated. As a result, Germany now appears to be the weakest performer among G7 countries in the post-pandemic period. This revision may also give the government more financial flexibility, and it wouldn’t be unexpected if there’s increased speculation about potential financial measures in the Chancellor’s Autumn Statement in November.

British stock market is at high levels, the sentiment is weak and if the British PMI is published in the weak service sector, it will put more pressure on it. Technically, we are close to a mid-term support level, and like the Euro, we can have a recovery movement to the price volume area in the event of a break, and with the failure of the floor and pullback, the downward trend will continue to lower levels, which will be updated, in general, if possible. The price of maintaining this floor is placed in a range box.

High-risk market assets

The Australian dollar, Canadian dollar
🇨🇦 BOC will hold a meeting on Wednesday and decide on the interest rate. Their previous decision was to raise interest rates by 0.25 percent, and on the other hand, low inflation data for Canada reinforces this assumption for not raising interest rates. Inflation in Canada is currently higher than the Bank of Canada’s 2% target. However, since Canada’s core inflation rate is closer to that target compared to other major economies, Now adopt a wait-and-see approach to determine whether the past interest rate hikes continue to put downward pressure on prices or not. Anyway, Possible gains for the Canadian dollar after the central bank meeting may depend largely on Friday’s employment report for August.

🇦🇺 Interest rate decision on Tuesday, Sep 5. Its result can influence the market’s expectations about the future path of monetary policies of other currencies. Australia’s central bank officials did nothing to interest rates in the previous session. Expectations again for the bank to keep interest rates unchanged, the unemployment rate in Australia has increased from 3.5% to 3.7%, and core inflation in Australia has decreased from 5.4% to 4.9% annually, which makes the possibility of no interest rate hike for Australia.

Economic calendar

Important news/events for this week:

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Week ahead

Dollar rise again

The recent financial markets have been driven by sentiments, particularly revolving around the United States debt ceiling issue. Treasury Secretary Janet Yellen has raised concerns about a potential default in June if Congress fails to extend it. President Joe Biden and senior Congress members are actively negotiating to resolve the matter, which mainly centers around spending levels. Opposition Republicans have indicated a willingness to raise the debt ceiling if the Government accepts spending cuts.

Market expectations of a Fed rate hike rose to 65% after positive macroeconomic data and higher inflation figures were reported. According to the CME FedWatch Tool, the Fed is projected to hike at the 13th meeting, with interest rates predicted to rise by 0.25 percent on June 14.

Overall sentiment has turned more hawkish on the Fed, and if the debt ceiling crisis is resolved favorably and next Friday’s NFP prints more than expected, a rate hike in June seems more likely.

The next round of US employment data (NFP) on Friday is very important.

Forecasts for the US non-farm payrolls report added 180,000 jobs in May, which was less than the previous month, but still a significant figure. The unemployment rate is expected to rise to 3.5 percent, but wage growth will pick up slightly over the year.
This week, Investors will be watching the payrolls and UNEMPLOYMENT RATE. the result is Fed’s next moves, as any unexpected changes in policy could lead to significant market volatility. In the meantime, traders are positioning themselves for a potential rate hike, with many betting on a stronger dollar and higher bond yields in the coming months.

📅 Ziwox Calendar

Interest rate expectations rice due to the UK inflation

UK inflation rate has hit single digits anew, though it has not attained the number foreseen by economists. The United Kingdom’s net inflation growth has surged to the same level as ten years ago.

Expectations are high for a Bank of England interest rate hike soon; from 4.5% to a minimum of 5%, and possibly even as high as 5.5% to curb inflation’s swift expansion, according to financial market predictions.

Inflation figures have impacted the British bond market leading to heightened interest rate expectations, resulting in government bond yields rising to a multi-month high and investors anticipating increased bond yields.

We don’t have any important calendar for GBP this week, but the US economic calendar is busy with the full US employment report or NFP on Friday. Continued strong growth in the US labor market will increase the interest rate of the Federal Reserve, favoring the US dollar and harming the GBPUSD currency pair. The US government and parliament are close to a debt agreement, with a deadline of June 1st, and delays will harm the US economy.

Eurozone and failure to grow

Euro had an uneventful week. Euro remained feeble versus USD and struggled against GBP. It has slumped against USD uninterruptedly for four weeks.

ECB officials continue to favor interest rate increases, yet this stance hasn’t visibly impacted the euro. This may be due to the fact that the ECB’s rate hikes have translated into higher prices, rendering the official’s hawkish outlook ineffective in shaping interest rate forecasts.

Next week, Eurozone will release inflation data, but the forecast suggests that significant deviation from expectations in the inflation data of the euro area is unlikely.

The main driver of the EURUSD currency pair is again the US dollar and the news related to the negotiations on the debt ceiling of the US federal government. In the meantime, the US NFP employment report will be very important for the market.

Release of data from China, Canada, and Australia

On Wednesday, the newest purchasing managers’ index (PMI) figures will be disclosed in China. As China’s economy has recently lost strength with the fading of the reopening boom, the results of these surveys will display if the disquieting trend persisted in May. In case it did, the currencies of countries such as Australia and New Zealand, which rely on Chinese demand for their exports, may undergo additional decline.

The fundamental bias of AUD and NZD is Bearish and the forecast is Bearish too.

The release of the latest purchasing managers’ index (PMI) figures in China on Wednesday will be closely watched by investors and analysts alike. With the country’s economy experiencing a slowdown in recent months, the PMI results will reveal whether the trend continued into May. If so, this could have detrimental effects on the currencies of countries heavily reliant on Chinese demand for their exports, such as Australia and New Zealand. As such, many will be keeping a keen eye on the figures to gauge the health of China’s economy and the potential knock-on effects on the global market.

Economic calendar

Important news/events for this week:

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Week ahead

Everything involved in FED decisions

🇺🇸 More than 82% of market participants do not expect an interest rate hike by the Federal Reserve in the June 14 meeting. (The current interest rate ceiling is 5.25%.)

As it is known, market participants do not only expect interest rates to increase but also to decrease it. But it should be noted that if the stickiness of inflation is high, the Federal Reserve will probably increase the interest rate again, and because the market has predicted a decrease in the interest rate, this issue can put heavy pressure on stocks and indices. be risk-averse. Of course, this analysis is based on the assumption that the US labor market is strong and the unemployment rate is low. If the unemployment rate increases, the Federal Reserve will have to adopt an expansionary policy, and Congress will urgently increase the debt ceiling of the US government.

The US dollar is the foundation of all financial markets. Always one side of the price of commodities (like crude oil, Silver, and gold) or cryptocurrencies like Bitcoin and even the stock market is the US dollar! The US dollar is the main driver of all financial markets in the world. The US economy is the largest economy and the US dollar is the most common currency in the world. This is why all traders of all markets are confused in their decisions. Because the ability to predict the decisions of the Federal Reserve at this point in time has become difficult.

Why is the dollar strong even with the risk of rate hikes ending?

The US dollar index strengthened against most major currencies last week. In fact, the US dollar index has grown by almost 2% over the past two weeks. This is the best 10-day gain in the US dollar index since mid-September. But what happened that the US dollar index strengthened and is it possible to continue the growth of the US dollar?

The US dollar has grown as has the yield on US Treasuries. This means that the interest rate expectations of the market are retreating from the interest rate cut. Since the beginning of the US credit crisis, interest rate expectations quickly moved from interest rate increases to interest rate decreases. The market was worried that with the onset of the credit crisis, the central bank would be forced to lower interest rates to prevent recession and economic crisis. For this reason, traders buy the dollar as a safe asset

Interest rate increase or decrease?

While the market’s interest rate expectations were moving away from a rate cut, the chairman of the US Federal Reserve gave a speech saying that there is no need to raise interest rates. The market is preparing for another rate hike, but the Federal Reserve has not made a decision. This means federal uncertainty and that everything depends on the performance of economic indicators. The performance of the US economic data will determine whether the Federal Reserve will move towards raising interest rates or not.

Traders are focused on the net PCE inflation index.
April’s expectation for this index is 4.6%. This is not a good figure for the central bank. This means that the Federal Reserve may try to raise interest rates to lower it.

📅 Ziwox Calendar

Eurozone

🇪🇺 Even though there has been no change in the possibility of interest rate hikes for the European Central Bank, a batch of recent worrying data for Germany, along with the recovery of the US dollar, have caused the Euro to fall, and as a result, the single currency has reached several levels. Lost a key.

The EURUSD currency pair now trades in a key area of 1.0800. And the reason for that is the fear of recession and global financial problems and the growth of the dollar last week. But at these low levels, can you think of buying Euros?
A key driver of the euro’s attractiveness against the dollar recently has been the perception that the Federal Reserve has reached its interest rate peak while the European Central Bank still has a way to go for contractionary policies. Although the European Central Bank will still be on the path of contractionary policies, markets are already re-betting on an interest rate hike by the US Federal Reserve after Logan’s speech.

COT report of Euro and US dollar

Ziwox Terminal (COT report)


You should note that the US debt ceiling problems and the purchase of the EURUSD currency pair were the biggest transactions among the G10 currencies, and since recent developments have ended positively for the dollar, we will probably see a Long Squeeze in this currency pair. According to the COT report, 7667 Long net positions Increased in EUR, and 5933 Long net positions Increased in the last week and these close positions by these holders can be a Long Squeeze situation. There is plenty of room to reprice the hawkish Fed expectations, so finding a floor for the EURUSD pair is risky right now.

The PMI indicators that will be published on Tuesday can play a very important role in stopping the fall of the euro or, as we mentioned above in the (Long Squeeze), fuel a sharp and further fall. The forecasts do not indicate much change in the economic outlook of the Eurozone. The manufacturing sector is expected to contract again, with growth fueled by service industries.

RBNZ, Hike interest rates again?

🇳🇿 The Reserve Bank of New Zealand is holding a policy meeting this week. It is expected to raise interest rates by 0.25% on Wednesday. If it does, it would be the 12th consecutive increase since the contractionary cycle began in October last year and would take interest rates to 5.50 percent, the highest among advanced economies.

The Bank of New Zealand will release updated forecasts in its quarterly monetary policy statement on Wednesday, so the New Zealand dollar could rise if policymakers raise their terminal rate to meet or exceed market expectations.

Next, in this week’s economic calendar, we will have Australia’s preliminary PMI indicators. For Canada, April wage growth will be released on Thursday. And for Japan, we’ll have machinery orders, the manufacturing PMI, and a preview of May inflation with the Tokyo CPI.

Economic calendar

Important news/events for this week:

[wpdatatable id=24 table_view=regular var1=2023-05-21 var2=2023-05-28 var3=High]


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Week ahead

End of interest rate hikes by FED

🇺🇸 For the US dollar, the CPI index for April, due out on Wednesday, will be on everyone’s radar. The core CPI data is expected to change from 5.0% to 5.2% year-on-year, while the core CPI rate is expected to be unchanged at 5.6% year-on-year, indicating that the increase in the cost of factory goods accelerated during the month.

Also, the U.S. Nonfarm Payrolls data and last week’s US jobless claims released rose by the most in six weeks, a sign that the US labor market may be weakening. For this reason, this week’s inflation can be very important because the reduction of inflation along with the pressured job market can provide peace of mind for the Federal Reserve.

Note that investors also expect interest rates to fall by more than 0.75% by the end of the year.

Specifying the policies of banks turn by turn, Now for BOE

🇬🇧 After a turbulent week for the European Central Bank and the Federal Reserve, it is the Bank of England’s turn.

In its last meeting in March, the Bank of England increased the interest rate by 0.25% this time after increasing it 10 times.
BOE officials downplayed the surprise rise in inflation in February and focused on their next steps, saying more accommodative policy would be needed if there was evidence of sustained price pressures. The view that European banks, including the UK, are better supervised than US banks appears to have been partly supportive of European currencies. This raises the expectation of traders and analysts to predict interest rate hikes several more times for the BOE.
Since then, data has shown that inflation has eased less than expected and the core inflation rate has remained marginally above 10 percent year-on-year, allowing investors to see around 0.6 percent more rate hikes by the end of this year. price For next week’s session, investors are roughly 85% likely to see interest rates rise by 0.25%, with the remaining 15% likely to hold interest rates unchanged.

Therefore, the market has well-priced the pound’s currency strength with a 0.25% hike, so what causes more rapid growth is a surprise greater than 0.25%.

What could further dampen the bullish outlook for the pound could be a bigger-than-expected decline in Britain’s first estimate of first-quarter gross domestic product (GDP), which is due to be released on Friday alongside the country’s trade data for March.

China, Australia, and New Zealand

🇦🇺 🇳🇿 🇨🇳

Trade data from the world’s second-largest economy and Australia and New Zealand’s main trading partner (China) is due on Tuesday and may be of interest to traders for the New Zealand dollar and the Australian dollar.

After China’s PMI data disappointed traders last week, the release of weak trade data this week could indicate that China has yet to return to its previous decline after declaring the end of the Coronavirus in the world.

China’s Consumer Price Index (CPI) and Producer Price Index (PPI) will be released on Thursday.

Economic calendar

Important news/events for this week are:

Thu May 9:

🇦🇺 AUD RETAIL SALES (MOM)

Wed May 10:

🇩🇪 GERMAN CPI (MOM) (APR)

🇺🇸 USD CPI & CORE CPI (MOM) (APR)

Thu May 11:

🇬🇧 BOE INTEREST RATE DECISION (MAY)

🇺🇸 USD INITIAL JOBLESS CLAIMS

🇺🇸 USD PPI (MOM) (APR)

Fri May 12:

🇬🇧 GDP index


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Australia: Reserve Bank surprises with 25bp hike

The “pause to assess” seems to have ignored the improvement in inflation

At its previous meeting in April, the Reserve Bank of Australia (RBA) left rates unchanged, “…to provide additional time to assess the impact of the increase in interest rates to date and the economic outlook…” In our view, the most relevant data since then was the March inflation print, which showed annual inflation dropping to 6.3%YoY, well below the 8.4% December peak. We anticipate further quite rapid declines in inflation over the coming months, as high base effects from last year drop out, and as the boost to inflation from rents subsides as it has already started doing. That said, the April inflation data might drift sideways before the next leg down recommences. 

Meanwhile, the rate of wage-price increases remains very benign at 3.3%YoY, and the latest statement’s reference to “…Unit labour costs are also rising briskly, with productivity growth remaining subdued” seems to be confusing the cyclical slowdown in growth and its negative impact on productivity (which is simply a residual of growth and labour inputs) with something that is structurally inflationary, which we don’t believe is the case.

Governor Lowe has a very different perspective to us, and also it appears to the majority of other forecasters who were also looking for no change in rates at this meeting. The accompanying statement that came alongside the RBA’s decision says of their forecasts that “…it takes a couple of years before inflation returns to the top of the target range; inflation is expected to be 4½ per cent in 2023 and 3 per cent in mid-2025”. We would be very surprised if it took anything like this long. History will show whether we or Governor Lowe are right, and in our view, sooner than the RBA might imagine. 

Forward guidance lacks consistency 

Not only did today’s hike take markets by surprise, but the comment that “…Some further tightening of monetary policy may be required to ensure that inflation returns to target in a reasonable timeframe”, also seems to be at odds with the decision to change to that wording at the March meeting, downgrading the previous wording from “…further increases in interest rates will be needed over the months ahead”. At the time, this change was widely understood to mean that from multiple anticipated hikes, only one more hike was then expected. Now we have had that one, but it still sounds as if the RBA is looking to deliver more, despite progress on inflation. It certainly feels as if whatever message the RBA is trying to convey, they aren’t getting it across very effectively.  

Markets had to do quite a lot of adjusting to take on board the RBA’s shock decision. The AUD shot back up over 67 cents and 2Y Australian government bond yields rose more than 26bp with a smaller 13.7bp rise in 10Y government bonds. 

What to do with our forecasts?

We had been on the verge of reducing our previous cash rate forecast peak rate from 3.85% to 3.6%. But following today’s decision, we will no longer need to do so. The question remains, should we push this higher to 4.1% or above?

Our inclination right now is not to do so. This latest hike didn’t look necessary to us in order to bring inflation down, and the forward guidance contained in the latest statement is also not particularly convincing. Like the RBA, we will watch the data before making any further decisions. And the April inflation print might not be too helpful to our case – we expect it may go sideways in year-on-year terms before moving lower again thereafter. But beyond the very short-term, our base expectation remains that the rate hikes that have already been implemented will be enough to continue to deliver progress on inflation. And if we get more, then it reduces the chances of achieving a soft landing, and we may begin to see that reflected in lower longer tenor bond yields if the RBA follows through on its latest hawkish guidance. 


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Week ahead

US Economic Rise in Prices and Inflation: What to Expect from the Federal Reserve

🇺🇸 Last week, US manufacturing and service sector PMIs were released in their preliminary assessment of April.
The data showed that the average price of goods and services rose in April from September last year, and the inflation rate has now risen for three consecutive months. That increase helps explain why net inflation has been stubbornly up 5.6 percent, and points to a possible pick-up, or at least some stickiness, in consumer price inflation. Also, the index data of the contenders have been relatively worse than the market expectations, but the Philadelphia manufacturing survey has been reported to be weaker than the most pessimistic number expected. These data caused the market’s expectations for the interest rate of the Federal Reserve to change slightly.
Federal Reserve officials will remain silent next week as they enter a shutdown period. Still, there’s plenty on the U.S. economic calendar to help traders know what to expect from the Fed.

This week, we first have the consumer confidence index for the month of April, which will be released on Tuesday along with the sales figures for newly built homes in March. On Wednesday, durable goods orders will be released, but the first very important data will be seasonal changes in the gross domestic product (Q1), which will be released on Thursday.

The US economy is expected to have grown during this period, which means that a recession is not imminent. The pending sales will also be published on Thursday. The complexity of decisions is such that any data that induce recession to traders, although it weakens the US dollar, on the other hand, it also increases the demand for the safe dollar.

We consider an upward trend for the US dollar for three reasons

  1. High inflation in Britain
    It causes investors to worry about the increase in global prices and the concern of further price increases, interest rates will increase not only from the BOE but also from the Federal Reserve.
  2. Bullard of the Federal Reserve
    It insists on raising rates two more times. While he is a hawkish person, his views influence the market.
  3. Limited Volatility:
    After last week’s correction, the dollar is benefiting from some demand.


Japan, consistent in Dovish policy

🇯🇵 Last Friday Japan’s PMI data released showed that Japan’s Jibun Bank manufacturing PMI rose to 49.5 in April 2023 from a final 49.2 in March, marking the highest reading since October last year amid further economic recovery. It was the sixth straight month of contraction in the sector, but the mildest in a row, as new orders fell at a slower pace and sales fell to their slowest pace since last July due to a softer decline in foreign demand. Meanwhile, production slowed slightly. At the same time, employment remained unchanged and workloads decreased at a slower pace. On the pricing front, input cost inflation eased to a 22-month low and there were more signs that supply chains are moving closer to stabilization, but output cost inflation picked up. Finally, business sentiment fell to a four-month low but remained stronger than the series average.

The Japanese yen continues to be under pressure from comments from new central bank chief Kazuo Ueda, who indicated the Bank of Japan will stick to its ultra-dovish monetary policy until price stability is achieved.

He said Japan’s inflation, currently around 3 percent, will return to below the BOJ’s 2 percent target later this year due to lower import costs. This week the economic calendar is full of inflation data releases, unemployment rates, and other important data. All of which can be traders’ bets for the Bank of Japan’s decisions on Friday. Although we can’t imagine any policy changes for the BOJ, this week’s data could have an impact on prices. Better-than-expected data could be good for the yen (JPY).


The RBA is waiting for the outcome of previous hikes

🇦🇺 Australian employment data came out surprisingly strong in March. The data showed that the labor market has held up well in the face of higher interest rates.
In monetary policy, the Reserve Bank of Australia kept rates unchanged at 3.6% in April after raising interest rates for ten sessions. Central bank seniors wanted more time to assess the impact of past interest rate hikes on the economic outlook. However, the RBA reiterated that further tightening may be needed to ensure inflation returns to target.
Therefore, whenever more figures are published in the Australian inflation data than expected, the probability of an interest rate increase by the RBA will increase, and traders will price this possibility in the purchase of the Australian dollar (AUD).


Economic calendar

Important news/events for this week are:

On Wed Apr 26:

🇦🇺 AUD CPI q/q and CPI y/y

Thu Apr 27:

🇺🇸 USD Advance GDP q/q and Unemployment Claims

Fri Apr 28:

🇯🇵 BOJ Outlook Report, Monetary Policy Statement and BOJ Press Conference

🇩🇪 German Prelim CPI m/m, CAD GDP m/m

🇺🇸 Core PCE Price Index m/m and Employment Cost Index q/q for USD.


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Reserve Bank of Australia logo AUD RBA

Analysts evenly split between 0.25% hike and no rate hike

RBA April 4 meeting poll: Analysts evenly split between 0.25% hike and no rate hike

Out of 27 analysts, 14 of them believe that the interest rate will increase and 13 of them expect a pause.

According to a Reuters poll of the Reserve Bank of Australia’s April 4 meeting:

Benjamin Picton, chief macro strategist at Rabobank: February’s inflation rate cut is not enough for the Reserve Bank of Australia to abandon its contractionary bias, as labor market indicators and relatively high inflation all point to the need for further contraction.

Gareth Aird, Chief Australian Economist at CBA, believes that the Central Bank of Australia’s messages have been somewhat erratic since the beginning of the year. “In a short period of time, the Reserve Bank of Australia has been talking about their forecasts of how much more or less contractionary they think policy should be.”

AUD - RBA Australia central bank

Reserve Bank of Australia Minutes

Reserve Bank of Australia Minutes: Governing Council agrees to revisit interest rate freeze case

Restrictive policy and an uncertain outlook are appropriate at some stage to keep rates steady

TOEFF provides time to reassess the outlook for the economy

The board tracks data on jobs, inflation, retail sales, business surveys, and global developments.

Further tightening of monetary policy is likely to be needed to reduce inflation

Inflation is very high, the job market is competitive and business surveys are strong

Reduced productivity can lead to more persistent inflation

The board noted that Australia’s lower interest rates than several other countries could weigh on the Australian dollar

Recent data has been softer than expected and growth appears to have continued into the second quarter

The Board felt it prudent not to place too much weight on single-period data

The board noted the financial pressure on some borrowers, consumption a key uncertainty

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