The Australian dollar is climbing ahead of the Reserve Bank of Australia rate decision at 0330 GMT. That might be the key factor in a meeting that’s wholly expected to be a non-event.
The important factor the keep in mind is that the Australian dollar is down 5% since the RBA’s last meeting. Governor Stevens will welcome that decline and it will mean less jawboning but it’s also inflationary and could mean sooner rate hikes next year.
At the moment, the OIS market doesn’t see any hikes real chance of a hike for two years. Even 18 months out, a hike is only 34% priced in.
The RBA will eventually remove a pledge for a “period of stability” but some shift in that direction could add to Monday’s Australian dollar gains.
Eamonn has a comprehensive preview of the RBA decision.
Australian Herald-Sun RBA watcher Terry McCrann is also out with his preview.
Australian dollar intraday
