On Tuesday, the Reserve Bank of Australua published the June meeting minutes. Generally, they still maintain the loosened monetary policy guide until the longer time. There is more.
The RBA statement announced in this morning minutes was quite mixed. They confess that there is a substantial progress, but the recovery path is still long and not even until now.
At the beginning of that June RBA meeting minutes, the policy makers highlight the economic condition globally where they thought that everything has been significantly increasing.
That is especially supported by the goods export demands from the other countries. That condition also comes together with the business survey which is stronger in the developed countries.
The Australia’s Central Bank Highlights the Global Economy
The wide vaccination programs and the loosened lockdown limitations in several areas bring the good effect. The Reserve Bank of Australia in a minutes released this morning also highlighted the uneven state of global economic recovery.
This is due to the very limited supply of Corona virus vaccine in developing countries. Restrictions imposed in developing countries in Asia such as India have been a negative catalyst.
That situation has slowed the momentum of the global economic recovery. Moving on to australia's domestic economic development, RBA officials see that the Kangaroo country's economy is currently in a transition.
That is from the recovery phase to the expansion phase with more momentum than previously anticipated. That country is quite succesfull to bring their economy condition into a better stage.
How Australia Handle the Pandemic
The government there gives a lot of stimulus where this thing brings the recovery process. The RBA's board of policymakers acknowledges that uncertainty surrounding the economic outlook has declined.
Meanwhile, the new victorian lockdown is expected to limit the consumption sector in the second quarter of this year. However, the outlook for the next quarter is expected to be stronger.
That is as the improving employment sector boosts Australian household spending. The announcement of the MINUTES of the RBA meeting this morning had little effect on the Australian dollar's movement against the greenback
That was reflected by the AUD/USD pair being in the range of 0.7700 or weakening 0.12 per cent on a daily basis. The weakening of the Australian dollar so far has been due to the RBA's stance of keeping policy loose at least until 2024.
The Rumor about the Fed’s Further Decision
At the same time rumours that the Fed is preparing to tapering the US dollar have strengthened in recent days. The US dollar stopped strengthening against other major currencies in trading session Monday (June 14/) night.
The Trading volume is fairly thin as traders are waiting-and-see for the Fed's (FOMC) committee meeting to be held midweek. Some predictions starts to appear.
Nearly 60% of economists in a Reuters poll predict that announcements about asset tapering or new taper talk will be discussed by the Fed at least in the next quarter.
That is the biggest possibility although the current recovery in the employment market is good enough. However, several analysts thought that Jerome Powell will still stay away from the important decision.
Dollar is stable, the Investors Anticipate the Hawkish
As the news was written, the Dollar Index was traded at 90.4, not continuing the half-percent surge achieved last week. The analyst from Forexxtra said that it is currently very difficult to read where the market is going next.
The Tight trading in financial markets came after the U.S. inflation data rose higher than expected. Annual America's inflation rose after freefall due to a lockdown policy.
That was forced to be implemented to prevent the transmission of the COVID-19 virus. Broadly speaking, the US Dollar has tended to stabilise in recent days although the yield on 10-year US bonds fell to 1.42%.
