 Australian Dollar remained stable after RBA decided to keep the cash rate unchanged at 4.35% as widely expected. In the post-meeting press conference, Governor Michelle Bullock acknowledged that there has been "good progress" in reducing inflation. However, the central bank did not adopt a more dovish stance, which came as a surprise to some market participants anticipating signals of policy easing in the near term. RBA maintained its position of "not ruling anything in or out," indicating flexibility but no immediate plans for rate cuts. The slight downgrade in inflation forecasts was not sufficient to warrant a rate cut son. Consequently, some analysts are now suggesting that, without significant changes in RBA's statement, the timing of the first rate cut may be pushed beyond February. Unless there is a substantial decline in underlying inflation in the fourth-quarter CPI report, RBA might wait for first-quarter data before taking action. This scenario would make May a more realistic timeframe for initiating a policy easing cycle. Elsewhere in the currency markets, overall activity remains low as traders await the results of the US presidential election. Dollar continues to sit at the bottom of the performance chart for the week so far, followed by Sterling and Yen. Swiss Franc is leading as the strongest currency, followed by Aussie and then Loonie. Kiwi and Euro are positioned in the middle. Despite these movements, all major currency pairs and crosses are sitting within last week's ranges, reflecting market indecision.... |
