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Weekly Roundup: Australian dollar spikes on surprisingly hawkish RBA rate hike

currency-newsWeekly Roundup: Australian dollar spikes on surprisingly hawkish RBA rate hike
The Australian dollar got off to a strong start last week after the Reserve Bank of Australia (RBA) surprised markets with a 25bps rate hike, versus the 15bps hike AUD investors had priced in.

Coupled with the RBA’s hawkish forward guidance and an upbeat retail sales releases this helped to underpin demand for the ‘Aussie’ through the first half of the week.

However, the majority of these gains were then reversed in the latter half of the week amid a notable souring of market sentiment. These losses were reinforced by the RBA’s monetary policy statement in which the bank cut its growth forecasts.

The Australian dollar has opened this week on the back foot, amidst the prevalence of risk-off flows, a trend which may persist given the increasingly gloomy outlook.

Elsewhere Australia’s latest business and consumer confidence indexes could exert some pressure on the ‘Aussie’, if sentiment continued to deteriorate in the face of increased economic uncertainty.
Philip McHugh

Philip McHugh

Joining the corporate trading desk in 2007, Phil now over sees all of Currencies Direct’s corporate dealing activity. Having gained experience working with hundreds of businesses to optimise international payments processes and execute comprehensive risk management strategies, Phil currently works with a portfolio of corporate clients whilst managing Currencies Direct’s overall market exposure

Phil has FCA approval and has completed the Certificate in International Treasury Management (CertiTM)

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