Daily digest market movers: Australian Dollar declines amid renewed US Dollar strength after FOMC meeting
- The Fed acknowledged economic expansion but noted easing labor market conditions and elevated inflation, maintaining a neutral outlook.
- Powell stated that the central bank will continue reducing its balance sheet and follow a data-dependent policy-making approach.
- Earlier in the week, the AUD/USD pair rose after the RBA left interest rates unchanged but signaled a hawkish stance, emphasizing the need for restrictive policy to combat inflationary pressure.
- RBA Governor Michelle Bullock reiterated the necessity of maintaining steady interest rates until the economy moderates more than anticipated.
- As the RBA doesn’t fully embrace cuts, the downside for the AUD/USD might be limited. However, the economic strength on the US is a thing to follow as it might continue pushing the pair down.
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