- The Reserve Bank of Australia made a surprise hike to its Cash Rate earlier by 0.25%, taking it to 3.85%. The RBA cited persistently high inflation above 7% which would take some time to reduce to target as the justification for this hike. The Australian Dollar traded higher following the news, with the AUD/USD currency pair up by more than 70 pips and the AUD/JPY currency cross up by more than 120 pips.
- In the Forex market, the US Dollar is falling again in line with its long-term bearish trend. The spotlight is on other currencies right now however, with the Australian Dollar showing the greatest short-term strength while the Japanese Yen is clearly the weakest currency, with the USD/JPY currency pair rising after making a long-term high closing price yesterday. The long-term bearish trend in the US Dollar remains valid, and trend traders may also be looking for long trades in the EUR/USD and GBP/USD currency pairs.
- Markets are looking ahead to Wednesday’s meeting of the US Federal Reserve, widely expected to hike rates by 0.25%, which many analysts see as paving the way for eventual rate cuts later in 2023.
- Several soft commodities are performing well, with the Sugar ETF CANE and the Cocoa ETN NIB reaching new multi-year high prices over recent days.
- Stock markets have been mixed but remain mostly bullish.
- The cryptocurrency Bitcoin is continuing to head lower after again rejecting resistance levels confluent with the major round number at $30k last weekend.
- US ISM Manufacturing data came in a little stronger yesterday than was expected.
- JPMorgan has finalised its purchase of the failed First Republic Bank.
- There will be releases later today of US JOLTS Job Openings data and New Zealand Unemployment data.
- It will be a public holiday in Japan tomorrow.