- AUD/USD refreshes weekly low near 0.6560 as the broader market mood is risk-off.
- Fed Powell considered current monetary policy as inadequate to bring down inflation to 2%.
- The RBA MPS report indicated that further tightening would be largely dependent on incoming data.
The AUD/USD pair continues its losing streak for the fifth trading session as fears of a global slowdown have deepened after hawkish commentary from Federal Reserve (Fed) Chair Jerome Powell in his commentary at the International Monetary Fund (IMF) on Thursday.
The S&P500 opens on a bullish note as fears of widening Middle East tensions have started fading. Investors see conflicts remaining contained between Israel and Palestine and may Iran would not intervene. The US Dollar Index (DXY) consolidates near 105.80, struggling to extend recovery, as investors shift focus to US inflation data for October, which will be published next week.
Jerome Powell, in his commentary, showed no confidence in the current monetary policy, considering it inadequate to bring down inflation to 2% in a timely manner.
The expectations that the Fed may not be able to achieve price stability with current interest rates are prompted by a resilient US economy. The world’s largest economy is performing stronger on the grounds of consumer spending and the labor market, which could slow the progress in inflation returning towards 2%.
On the Australian Dollar front, the Reserve Bank of Australia (RBA) released its Monetary Policy Statement (MPS) on early Friday. The report indicated that further tightening would be largely dependent on incoming data. The RBA warned that inflation has turned out persistent more than expected. As per the forecasts, inflation is seen easing to 4.5% by 2023, 3.5% by 2024, and 3.0% by the end of 2025.
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EUR/USD treads water just above 1.0400 post-US data
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GBP/USD remains depressed near 1.2520 on stronger Dollar
Poor results from the UK docket kept the British pound on the back foot on Thursday, hovering around the low-1.2500s in a context of generalized weakness in the risk-linked galaxy vs. another outstanding day in the Greenback.
Gold keeps the bid bias unchanged near $2,700
Persistent safe haven demand continues to prop up the march north in Gold prices so far on Friday, hitting new two-week tops past the key $2,700 mark per troy ounce despite extra strength in the Greenback and mixed US yields.
Geopolitics back on the radar
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