AUD Calms After RBA Minutes Today
London: 17 October 2023 (TraderMade): The Australian dollar saw an extension of its gains today, with AUD/USD trading at 0.6358 (about 11:34 AM GMT), marking a 0.18% increase. The pair had closed yesterday at 0.63388.
The Australian dollar has faced a challenging period recently, with a lack of winning weeks since September. The currency was at a nearly year-low point last week. However, it has rebounded this week, surging by about 1%, mainly due to a weakened US dollar.
Influencing factors
The Federal Reserve's "higher for longer" stance and increased uncertainty stemming from Middle East conflicts contribute to potential currency market volatility.
Despite the turmoil in the Middle East, the US dollar, traditionally considered a safe-haven asset, has not benefited significantly. Concerns persist that the Israel-Hamas conflict may spread to Lebanon and Iran, prompting the US to dispatch aircraft carriers.
RBA meeting minutes
The Reserve Bank of Australia released the latest meeting minutes today. While the central bank maintained rates at 4.10% for the fourth consecutive time, the minutes revealed considerations for a potential quarter-point rate increase.
Board members noted that inflation remained well above the 2%-3% target and was expected to persist for a while, with rising fuel prices contributing to headline inflation.
The RBA will meet again on November 3rd, with upcoming data releases determining the continuation of the rate pause or implementing a rate hike.
