The Reserve Bank of Australia left its benchmark interest rate unchanged at 4.35%.
➡️ At today's policy meeting, the RBA said that inflation remained too high to justify rate cuts and therefore left its Cash Rate stable at 4.35%. The Aussie reacted little to this news, as widely expected. In the medium term, this could position the Aussie as a major strong currency if risk sentiment remains positive.
➡️ Risk-on sentiment continues to dominate markets, perhaps receiving a further boost today as several members of the Federal Reserve have made public statements that a broad rate cut of 0.50% may be appropriate at the next Fed meeting in early NovemberStock markets are bullish, with the S&P 500 index which closes at a new record price. The leading asset at the beginning of the week is They , which again reached a new record price yesterday.
➡️ Many raw materials, in particular Crude oil but also some soft stocks, look much stronger thanks to the improvement in risk sentiment recorded in recent days.
➡️ In the Forex market, the Canadian dollar was the strongest major currency since the Tokyo open today, while the Japanese yen was the weakest. This is in line with risk sentiment, as the Loonie is tied to crude oil.
➡️ High-impact PMI data released yesterday for Flash Services and Manufacturing in the US, Germany, the UK and France showed below-expected results across all data points, suggesting a cooling of the economies in the United States, the United Kingdom and the Eurozone.
➡️ Australian CPI (inflation) data will be released early tomorrow morning. The annualized rate is expected to decline sharply, from 3.5% to 2.7%.
Credit by DailyForex.com
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