On Friday, the Australian Dollar (AUD) extended its consecutive four-session losing trend, presumably attributable to risk aversion. As the US Dollar (USD) strengthened on hawkish expectations that the Federal Reserve (Fed) will sustain higher policy rates for an extended period, the AUD/USD pair declined.
Consumer Inflation Expectations for the following 12 months fell to 4.1% in May from 4.6% in April, the lowest level since October 2021, exerting pressure on the AUD. This exacerbated apprehensions that inflation might persist above the target level for an extended duration. According to the minutes of the most recent meeting of the Reserve Bank of Australia (RBA), policymakers needed help in conclusively stipulating or precluding future adjustments to the cash rate.
The USD extended its gains following releasing Purchasing Managers Index (PMI) data from the United States on Thursday that exceeded expectations. This information increased Treasury yield concerns that interest rates would remain elevated for an extended period. Furthermore, the most recent minutes of the Federal Open Market Committee (FOMC) revealed that policymakers at the Fed were concerned about the prolonged stagnation of inflation at the beginning of 2024, which was slower than expected.
Consumer Inflation Expectations for the following 12 months fell to 4.1% in May from 4.6% in April, the lowest level since October 2021, exerting pressure on the AUD. This exacerbated apprehensions that inflation might persist above the target level for an extended duration. According to the minutes of the most recent meeting of the Reserve Bank of Australia (RBA), policymakers needed help in conclusively stipulating or precluding future adjustments to the cash rate.
The USD extended its gains following releasing Purchasing Managers Index (PMI) data from the United States on Thursday that exceeded expectations. This information increased Treasury yield concerns that interest rates would remain elevated for an extended period. Furthermore, the most recent minutes of the Federal Open Market Committee (FOMC) revealed that policymakers at the Fed were concerned about the prolonged stagnation of inflation at the beginning of 2024, which was slower than expected.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.