- The AUD/USD pair is trading sideways near 0.6400, tracking the US Dollar.
- Fed spokespeople supported keeping interest rates unchanged in monetary policy in September.
- The Australian Dollar remained on the move this week as the RBA kept interest rate policy unchanged.
The AUD/USD pair is trading up and down near the crucial resistance of 0.6400 in the London session. The pair turns sideways following the footsteps of the Dollar Index (DXY), which maintains a bid near five-month highs at 105.20.
S&P 500 futures posted some losses in the European session, portraying a cautious mood in the markets amid accelerating fears of economic turmoil due to tight monetary policy by Western central banks. Investors have parked their funds in the dollar due to uncertainty about the global economic recovery in a high interest rate environment.
European and Asian economies face the wrath of higher interest rates from their respective central banks in the battle against stubborn inflation. The economic activities of the largest continent and the trading bloc are contracting due to the vulnerable demand environment. Additionally, businesses are avoiding new credit around the world due to rising interest rates.
On Thursday, Fed spokespeople were in favor of keeping interest rates unchanged in September monetary policy. Investors await August Consumer Price Index (CPI) data for more clues on interest rate policy.
This week, the Australian Dollar remained on the move as the Reserve Bank of Australia (RBA) kept interest rate policy unchanged. On the outlook for the labor market, RBA Governor Philip Lowe cited that the unemployment rate may remain close to 40-year lows and that wage growth is strong.
Meanwhile, investors are keeping an eye on China’s Consumer Price Index (CPI) for August, which will be released on Saturday. Monthly economic data is expected to expand at a rate of 0.3%, higher than the 0.2% recorded in July. Annual inflation would be 0.1%, compared to a deflation of 0.3%.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
