Equity rallies off Monday’s open have returned the Australian Dollar (AUD) to a healthier 0.6500 against the US Dollar (USD) from recent historical lows around 0.6380. US Bond yields ticked lower as the greenback was sold off. The US Dollar index retreated to 112.00. The US economy is facing a hard landing as the Federal Reserve remains committed to fighting inflation despite fears they could send the economy into recession. The Fed are predicted to raise rates further to around 4.4% early 2024. The labour market remains tight- it seems the only way the US economy is able to bring down inflation is to delve into recession. The RBA rate release is out today with the central bank expected to raise interest rates to 2.85% from 2.35%- perhaps the last big move before Lowe backs off and slows the tightening cycle to 25-point moves. Downside risks remain in the pair. Buyers of USD should consider.
Current Level: 0.6505
Last Weeks Range: 0.6362-0.6529