The Federal Reserve kept rates unchanged late last week at 5.50% but pivoted on policy reflecting a dovish stance. The Fed’s ability to guide the economy to a soft landing is being commended with the timing of rate cuts suggested for 2024 along with key risk management. The chance of further rate hikes are now slim with several rate cuts being priced in from mid-2024. The AUD/USD bounced from 0.6600 levels to 0.6670 around the release. Unemployment rose in November to 3.9% the highest level since May 2022 vs forecast of 3.8%. This sent the Aussie higher again underpinning the recent RBA’s concern of persistent domestic demand. The economy added 61,500 jobs – more than the 11,500 expected. The Aussie has held up well since as equities posted gains, into morning trade around the 0.6700 level just off a 20-week high.
The current interbank midrate is: AUDUSD 0.6702
The interbank range this week has been: AUDUSD 0.6689- 0.6734