Weekly Roundup: Australian dollar undermined by souring market mood

Amy Richards February 6th 2023 - < 1 minute read

The Australian dollar got off to a poor start last week, with the currency coming under pressure in response to a risk-off impulse in addition to a downbeat Australian retail sales print.

The ‘Aussie’ then managed to catch some bids in midweek trade as a dovish Federal Reserve bolstered hopes that a more moderate path of US monetary tightening could relieve pressure on the global economy.

However AUD exchange rates then faced fresh headwinds in the latter half of the week after a bumper US employment report revived Fed rate hike bets and soured market sentiment.

Turning to this week the focus for AUD investors will undoubtedly be on the Reserve Bank of Australia’s (RBA) first interest rate decision of 2023.

The RBA is widely expected to raise rates by another 25bps this month. But with the hike largely priced in the focus will be on its forward guidance. Could a cautious outlook lead the Australian dollar to tumble?

Written by
Amy Richards

Select a topic: