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MTrading Team • 2023-04-04

AUDUSD bears cheer RBA’s halt to rate-hike journey amid sluggish session

AUDUSD bears cheer RBA’s halt to rate-hike journey amid sluggish session

After a volatile start to the key week, markets turn dicey as traders struggle to justify inflation and geopolitical woes amid the easing rate hike concerns. Adding strength to the lackluster moves could be the lack of major data/events apart from the Reserve Bank of Australia’s (RBA) monetary policy announcements.

That said, the US Dollar licks its wounds and joins the RBA’s inaction to drown the AUDUSD prices. Even so, the GBPUSD and EURUSD remain firmer as hawkish concerns about the BoE and ECB contradict the latest talks of easy rate hikes, or none at all, from the US Federal Reserve.

Elsewhere, the yields remain sluggish and so do US stock futures, which in turn restrict moves of the Asia-Pacific shares.

Further, Gold price fades the week-start gains but Brent oil renews a one-month high while extending the previous day’s rally amid supply crunch fears from Russia.

Cryptocurrencies are mostly firmer amid talks surrounding the rejection of US Dollar as a base for BTC and no immediate regulatory woes for the key industry player Binance.

Following are the latest moves of the key assets:

  • Brent oil rises 1.0% to $86.00 as it renews one-month high to extend the week-start rally.
  • Gold prints mild losses near $1,980 while reversing Monday’s gains.
  • USD Index pares recent fall around 102.00 but buyers struggle of late.
  • Wall Street closed mixed and so did the equities in the Asia-Pacific region. However, shares in Europe and the UK, grind higher of late.
  • BTCUSD and ETHUSD remain mildly bid around $28,050 and $1,820 in that order.
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RBA tries to move the dust amid inactive markets

RBA announced the much-awaited pause in its rate hike cycle, after 10 consecutive rate lifts, which in turn weighed on the AUDUSD prices even as the Rate Statement highlighted readiness to renew the rate lift trajectory if needed.

However, markets outside Australia remained mostly sluggish as hopes of easy rates contradict the fears of a fresh bout of US-China and Russia-Europe tension. On the same line could be the hawkish comments from global policymakers despite recently downbeat data from the US and Europe.

On a different page, Oil prices remain firmer and stretch the previous day’s gains towards refreshing a one-month high but Gold has to respect the US Dollar’s corrective bounce amid challenges emanating from China, one of the key XAUUSD consumers.

EURUSD and GBPUSD cheer comparatively more hawkish remarks from ECB and BoE officials than the Fed talks while USDCAD struggles between the US Dollar recovery and firmer Oil prices. Further, USDJPY reverses the previous day’s pullback from a two-week high.

Additionally, BTCUSD and ETHUSD print mild gains despite the US Dollar’s corrective bounce as policymakers take a sigh of relief from the regulatory concerns, at least for now.

  • Strong buy: USDJPY
  • Strong sell: ETHUSD, GBPUSD
  • Buy: USD Index, USDCAD, Nasdaq, EURUSD
  • Sell: DAX, FTSE 100, gold, BTCUSD, AUDUSD

Second-tier US data eyed

Given the light calendar for the rest of the day, market players may witness inaction ahead of the US Factory Orders and the Fed talks. However, major attention should be given to Wednesday’s US ISM Services PMI, ADP Employment Change and Friday’s US NFP. Above all, Fed concerns and yields are crucial for clear directions.

May the trading luck be with you!