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Weekly roundup: Australian Dollar weakens on dovish RBA comments

currency-newsWeekly roundup: Australian Dollar weakens on dovish RBA comments
The Australian dollar spent almost all of last week on the back foot, with the ‘Aussie’ being particularly undermined by some dovish comments from Reserve Bank of Australia (RBA) Governor Philip Lowe.

Despite the RBA recently moving ahead with its plan to begin tapering its pandemic era asset purchases, Lowe scuppered hopes that this could lead to the RBA raising interest rates within in the next couple of years, as he suggested it would be at least 2024 before the bank is ready to consider such a move.

Further undermining AUD exchange rates was the publication of Australia’s latest jobs report. While August’s figures revealed that unemployment fell for the ninth consecutive month, analysts warn that they were warped by people dropping out of the workforce, rather than strong employment growth.

Adding to the Australian dollar’s woes through the second half of the week was also a prevailing risk-off mood, courtesy of Chinese growth concerns and a strong pick up in the US dollar.

Looking ahead, the release of Australia’s latest PMI figures could act as another headwind for the ‘Aussie’ this week as September's figures are expected to report another contraction in growth due to the ongoing lockdowns in some parts of the country.
 
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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