Daily Market Comment – Dollar knocked down after jobs report, stocks party
- Marios Hadjikyriacos
- US dollar takes some damage, equities hit new records after US jobs data
- Oil prices remain elevated amid OPEC divisions, talks continue today
- Aussie dollar braces for crucial RBA meeting early on Tuesday
The next event to inject some volatility into the FX arena will be the Reserve Bank of Australia meeting early on Tuesday. It will be a tricky one. On the bright side, the Australian economy is doing phenomenally well. The unemployment rate reached pre-pandemic lows in May already, the housing market is booming, and the prices of commodities that Australia exports are high.The catch is that half the country is now back in a lockdown after new clusters of infections popped up, and vaccinations have been slow. Until recently it looked like the RBA would move towards exiting cheap money, but with the latest lockdowns, it might resort to ‘half measures’. It could adopt a more flexible approach to its bond purchases, which would essentially be a tapering move, but stress that it doesn’t expect to raise rates for a long time, negating any massive rally in the aussie. US markets will remain closed today for Independence Day, so liquidity will be thinner than usual, making sharp market moves possible without much news behind them.
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.