RBA Minutes Revealed 'Fine Balance' for This Month's Surprise Hike

What’s funny is that the Reserve Bank of Australia (RBA) minutes released earlier today showed that the RBA rate hike – which was the first hawkish shock in a series of hawkish central bank decisions this month – showed that the decision to hike rates by a surprise 25bp was ‘finely balanced’ and further decisions will depend on inflation outlook and home market. The minutes softened the RBA expectations but will likely undo the pledges of more policy action from the other central banks.

Last Week's USD Setback/Euro Rally Taking a Breather

Last week’s USD setback/euro rally are taking a breather. This process might continue short-term, especially if equities would fall prey to some profit taking after recent rebound. In CE, we also keep an eye a the rate decision of the Hungarian central bank (expected to ease the O/N deposit rate to 16%).

RBA Minutes Less Hawkish Than Expected, For Now

RBA Minutes Less Hawkish Than Expected, For Now. The Minutes from the Reserve Bank Board’s meeting in June provide a more balanced approach to the outlook for rates than we saw in the Governor’s statement following the decision to raise the cash rate by 25 basis points.

Markets Slip Ahead of Powell's Testimony

Fed Chair Jerome Powell will be under the spotlight this week as he provides his semi-annual monetary policy report to Congress on Wednesday and Thursday.

US Return Could Boost Activity, Focus Remains on BoE and UK Inflation

Stock markets remain slightly in the red on Tuesday but activity should pick up with the return of Wall Street from the long bank holiday weekend.

Diverging Policies

In numbers, the expectation of a no rate hike at today’s decision jumped past 90%, while the expectation of a no rate hike in July meeting rose from below 30% to above 35%. The S&P500 extended its advance to 4375, while Nasdaq 100 rallied past the 14900 level. Small companies followed suit, with Russell 2000 jumping to the highest levels since the mini banking crisis.

Today's FOMC Will be a Key Focus for China and Hong Kong Stocks

China proxies; Hang Seng Index, Hang Seng TECH, and Hang Seng China Enterprises have outperformed S&P 500 & MSCI All Country Asia ex Japan since 31 May.

A Heavy Bitcoin as a Warning Before FOMC?

The dynamics of Bitcoin are pulling the crypto market down faster than other assets, which could manifest as reduced demand in the most risk-sensitive part of the market spectre before the FOMC decision results.

British Pound Extends Gains, Fed Decision Looms

The British pound is in positive territory on Wednesday. In the European session, GBP/USD is trading at 1.2645, up 0.27%. The pound surged close to 1% on Tuesday, after a red-hot UK employment report and the drop in US inflation.

Sunset Market Commentary

Fed preview: Yesterday’s more or less in-line CPI figures basically cemented the case for a skip in the tightening cycle. That said, we do expect the Fed to add a hawkish flavour because of  - amongst others - ongoing economic resilience, especially in the labour market and stalling/insufficient progress in the core disinflationary process.