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TD Securities strategists Prashant Newnaha and Alex Loo note that Australian Q1 Gross Domestic Product (GDP) matched the Reserve Bank of Australia’s (RBA) 0.3% q/q implied forecast, but highlight that household and government spending are weak while data centre investment props up activity. They stress that the economy is still growing above its speed limit and expect one final 25 bps RBA hike in August.RBA path shaped by weak demand”Q1 GDP landed bang in line with the Bank’s implied 0.3% q/q forecast. However, a breakdown of the data reveals that outside of data center investment, household and government spending is…
The Indian rupee weakened to a one-week low on Wednesday, as hostilities in West Asia pushed crude prices higher amid stalled U.S.-Iran peace talks while a drop in local stocks worsened the strain on the currency.Traders said state-run banks were selling dollars, most likely on behalf of the Reserve Bank of India, helping limit the fall in the rupee. These banks were also spotted conducting dollar-rupee buy/sell swaps, in line with recent sessions.The rupee fell about 0.5 per cent to 95.7825 per dollar, tracking declines in oil-sensitive regional peers like the Indonesian rupiah, which fell to a record low, and…
The Indian rupee could weaken to a record low of 98 against the U.S. dollar by July as the energy shock triggered by the Middle East crisis continues to pile pressure on domestic assets, especially the currency, a BofA Securities executive told Reuters. The rupee, Asia’s worst performing currency this year, has been battered by the war-led energy shock that threatens to slow growth and push up inflation in India, which imports almost 90% of its crude requirements and half of its gas needs. Authorities have implemented several measures to protect the currency and preserve dwindling foreign exchange reserves, with…
Gold (XAU/USD) extends the previous day’s late pullback from the vicinity of the $4,550 level and attracts some follow-through selling during the Asian session on Wednesday. Crude Oil prices rise for the third straight day amid renewed hostilities in the Middle East, reviving inflationary concerns and reaffirming market bets that interest rates would stay higher for longer. This, in turn, is seen as undermining the non-yielding yellow metal. Furthermore, geopolitical uncertainties assist the US Dollar (USD) in preserving its weekly gains, which turns out to be another factor that keeps the commodity depressed below the $4,500 mark, near the lower…
Mumbai: The Indian rupee weakened 29 paise on Tuesday, while intervention from the central bank contained further losses amid foreign investor outflows and high crude oil prices.The currency closed at 95.27, from its previous close of 94.99, as dollar demand from hedgers continued, traders said. It traded in the range of 95.29 and 95.02 per dollar.The rupee depreciated nearly 11% in FY26. It has depreciated 0.17% in FY27 so far. However, at current levels, the rupee has appreciated 2% from its record low of 96.96 on May 20.”Heavy bids from oil marketing companies have kept the rupee under pressure for…
Japan’s Finance Minister Satsuki Katayama said on Wednesday that the authorities are ready to act on the foreign exchange if required.Key quotes Ready to act on forex if required.Aligns with BoJ governor on several matters.Market reactionAs of writing, the USD/JPY pair is up 0.04% on the day at 159.97. Bank of Japan FAQs The Bank of Japan (BoJ) is the Japanese central bank, which sets monetary policy in the country. Its mandate is to issue banknotes and carry out currency and monetary control to ensure price stability, which means an inflation target of around 2%. The Bank of Japan embarked in an ultra-loose…
ABN AMRO economists Bill Diviney and Rose Heaulme note that Eurozone headline inflation rose to 3.2% in May, with core inflation surprising at 2.5%. Energy remains the main driver, while food inflation eased. A sharp jump in services inflation, likely linked to transportation and airfares, is seen as narrowly focused but warrants monitoring. They still expect two ECB rate hikes by July.Services-led upside surprise in May inflation”Eurozone inflation picked up in line with expectations to 3.2% in May, from 3% in April, while core inflation surprised to the upside, rising to 2.5% (ABN/consensus: 2.4%) from 2.2%.””The big upward surprise this…
TD Securities strategists have cut their Gold forecasts for the next two quarters as higher inflation expectations from supply shocks lift yields and keep the Dollar firm, with markets even pricing a potential Fed hike in late 2026. They see downside risk toward $4,000–4,200/oz if Oil surges, but materially upgrade long-term projections, targeting an average of $5,350/oz by Q2 2027.Short-term downgrades, long-term upgrades”Our gold price projections for the next two quarters have been downgraded materially, as higher inflation expectations associated with the negative supply shocks have pushed yields across the curve higher, kept the USD firm, and prompted markets to…
The Indian rupee and dollar-rupee forward premiums fell on Tuesday, driven by opposing forces of importer hedging, foreign portfolio outflows and likely central bank intervention across FX market segments.The rupee ended at 95.2650 per dollar, down 0.3% from its close in the previous session.Traders said that the losses would have been steeper had it not been for the Reserve Bank of India’s dollar-selling interventions, which have continued in almost every session since the rupee hit a record low of 96.96 per dollar in mid-May.The central bank has conducted these interventions alongside dollar-rupee buy/sell swaps to manage rupee liquidity and the…
The Indian rupee and dollar-rupee forward premiums fell on Tuesday, driven by opposing forces of importer hedging, foreign portfolio outflows and likely central bank intervention across FX market segments.The rupee ended at 95.2650 per dollar, down 0.3% from its close in the previous session.Traders said that the losses would have been steeper had it not been for the Reserve Bank of India’s dollar-selling interventions, which have continued in almost every session since the rupee hit a record low of 96.96 per dollar in mid-May.The central bank has conducted these interventions alongside dollar-rupee buy/sell swaps to manage rupee liquidity and the…