Home Markets Forex Today – Asian Session: Will Hopes Withstand Recession Fears?

Forex Today – Asian Session: Will Hopes Withstand Recession Fears?

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Forex Today – Asian Session: Will Hopes Withstand Recession Fears?

What to watch for on Wednesday, October 5:

Optimism prevailed for the second day in a row, leading to a continuation of the massive sale of the dollar. This time the catalyst was the Reserve Bank of Australia, which delivered a moderate surprise. Australian policymakers raised the cash rate by a modest 25 basis points, below the expected 50 basis points, being the first to stop ultra-aggressive quantitative tightening.

However, the worrying global scenario remains the same. Inflation remains stubbornly high, while the risk of recovery ession is present in most major economies. The EU published the Producer Price Index for August, which shot up 43.3% year-on-year, a record figure.

The decision fueled hopes that central banks are nearing the end of aggressive quantitative tightening. World stocks rallied, with US indices rising strongly for the second day in a row as major indices added more than 2% each.

bonusesof the state they continued to recover ground, keeping yields under modest pressure, which weighed on the dollar.

The EUR/USD pair is trading just below parity and at its highest level in more than two weeks. The GBP/USD pair has also risen and is currently trading at the 1.1470 area.

The Aussie was the worst performer after the RBA policy decision, and AUD/USD is now hovering around 0.6500. The USD/CAD crashed around 1.3500, quoting near the end of the American session.

The Swiss Franc was higher against the Dollar, with USD/CHF now trading around 0.9790, while USD/JPY continued to consolidate, now trading around 144.00.

Gold benefited from dollar weakness, trading around $1,725 ​​a troy ounce. Crude oil prices also rose, with WTI changing hands at $86.20 a barrel.

Market players are now waiting for the Bank of New Zealand Reservemonetary policy decision. The central bank is expected to raise the main rate by 50 basis points to 3.5%, and anything other than this should cause volatility across the currency board.

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Source: Fx Street

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