| Time | Country | Event | Period | Previous value | Forecast | Actual |
|---|
| 04:30 | Australia | Announcement of the RBA decision on the discount rate | | 4.35% | 4.35% | 4.35% |
| 06:00 | Germany | Factory Orders s.a. (MoM) | June | -1.7% | 0.8% | 3.9% |
During today's Asian trading, the U.S. dollar rose moderately against major currencies, rebounding from its lowest level since January 12, reached the day before amid concerns that the U.S. is heading for a recession.
The US Dollar Currency Index (DXY), which tracks the dynamics of the dollar against six currencies (euro, swiss franc, yen, canadian dollar, pound sterling and swedish krona) rose by 0.27% to 102.97. Yesterday, Fed policymakers rejected the view that weaker-than-expected July employment data meant the economy was in recessionary freefall, but also warned that the central bank would need to ease monetary policy to avoid such an outcome. According to the CME FedWatch Tool, markets see a 72.5% probability of a 0.5% rate cut in September, and a 54.4% probability of 0.25% rate cut in November. Overall, futures impose 110 basis points of cuts this year. Meanwhile, economists said Fed Chair Jerome Powell is likely to provide definitive guidance at this year's Jackson Hole Economic Symposium in August.
The Australian dollar rose 0.2% against the US dollar, helped by the results of the RBA meeting. As expected, the Central Bank left its interest rate at 4.35% (12-year high). Policymakers observed that the economic outlook is uncertain and recent data have demonstrated that the process of returning inflation to target has been slow and bumpy. The policy will need to be sufficiently restrictive until the board is confident that inflation is moving sustainably towards the target range, the bank added. Meanwhile, RBA Governor Michele Bullock warned that a rate cut is not on the agenda in the near future, adding that the Central Bank is ready to raise rates if necessary.
The yen fell 1.1% against the US dollar, to 145.80, after rising to 141.68 yesterday (the highest value since January 2), as traders contend with the unwinding of popular carry trades and the prospect of deep rate cuts from the Fed. CFTC data last week showed speculators' bearish bets against the yen have been slashed to $6 billion from April's near-decade high of $14.5 billion.