RBA adopting a more dovish tone could put further pressure on the Aussie – Commerzbank
|AUD/USD has come under pressure following the soft inflation data from Australia. Economists at Commerzbank analyze Aussie’s outlook.
Inflation leaps downwards
The quarterly increase was halved from the previous quarter, and at 0.6% quarter-on-quarter, is now in line with the RBA's inflation target of 2-3%. So it's no wonder that the market is starting to price in bigger rate cuts and the Aussie is coming under pressure.
The RBA may adopt a more dovish tone in its next statement, which, combined with lower inflation forecasts, could put further pressure on the Aussie.
However, the next inflation figures, especially those for the first quarter of 2024, will be crucial for further action. Until then, AUD/USD will likely be more dependent on the US side than usual. If, as our economists expect, there is a mild recession in the US and the Fed begins its cycle of rate cuts in the coming months, we should see much higher levels again.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.