BoC, Fed in focus, AUD data disappoint

Frank Walbaum FX Strategies.Asia

Important news for the day

Wed, 29th, 01:30 CET AU Consumer price index.
Wed, 29th, 15:45 CET CA BoC rate statement/Monetary policy report.
Wed, 29th, 20:00 CET US Fed funds rate.

Interest rate decisions

It will be important today to focus on both interest rate decisions. The Bank of Canada is expected to cut rates by 25 basis points, following the December meeting where a 50 basis points cut had been announced. Yet the focus will remain on the Fed. Chair Jerome Powell would need to resist pressure of the White House and remain focus to keep inflation data in sight, while not cutting rates too soon. Trump had expressed several times that the President should be involved in this decision making process, which often went badly in the past as other examples show.

Market talk

Some strength of the Greenback can be seen against other currencies. Shorter term charts suggest that the Dollar might gear up steam further. The AUD looks like it will continue it’s slide as the daily chart shows falling momentum again. Weaker than expected consumer prices underline this negative trend. It might be interesting to observe how equities will respond to that. The S&P 500 is rising again and also the Nasdaq keeps pushing higher. Major momentum might occur during the FED meeting tonight.

Tendencies in the markets

Equities positive, USD stronger, cryptos rising again, oil sideways, Silver positive, Gold positive, JPY weak.

Author

Frank Walbaum

FX Strategies.Asia

Frank has been working in the TV business for several years. Acquiring his skills in Germany’s biggest broadcasting station, he then chose to work and live in Asia, which was in 2007.

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