Australian Dollar Holds Firm
The Australian dollar held its recent gains near $0.70, remaining above multi-month lows as investors awaited further clues on the policy outlook. RBA Deputy Governor Andrew Hauser is due to speak on Wednesday, which could provide insight into the prospects for a fifth rate hike this year. An RBA official recently noted that the labor market may be cooling faster than anticipated, though the next inflation report on October 28 remains key to the policy outlook. Core inflation is expected to rise by 0.9—1.0% in the third quarter, potentially lifting the annual rate to 3.5—3.6%, above the RBA’s 2—3% target and its 3.3% forecast. Governor Michele Bullock and other officials will also face lawmakers that day, offering an opportunity to address the latest figures. Markets now price in roughly a one-in-three chance of a November hike, rising to 56% for December. Elsewhere, the Aussie also drew support from a broadly weaker euro as political concerns in France weighed on the single currency.
The Australian dollar held its recent gains near $0.70, remaining above multi-month lows as investors awaited further clues on the policy outlook. RBA Deputy Governor Andrew Hauser is due to speak on Wednesday, which could provide insight into the prospects for a fifth rate hike this year. An RBA official recently noted that the labor market may be cooling faster than anticipated, though the next inflation report on October 28 remains key to the policy outlook. Core inflation is expected to rise by 0.9—1.0% in the third quarter, potentially lifting the annual rate to 3.5—3.6%, above the RBA’s 2—3% target and its 3.3% forecast.
Governor Michele Bullock and other officials will also face lawmakers that day, offering an opportunity to address the latest figures. Markets now price in roughly a one-in-three chance of a November hike, rising to 56% for December. Elsewhere, the Aussie also drew support from a broadly weaker euro as political concerns in France weighed on the single currency.