Daily digest market movers: Australian Dollar rises sharply on RBA's rate hold

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  • The Aussie advanced significantly against the US Dollar after the RBA kept its interest rates unchanged at 4.35%, but maintained a hawkish message.
  • In fact, RBA Governor Michelle Bullock stated that the bank isn’t considering rate cuts.
  • Market participants anticipate that the Fed may implement another 50 basis point (bps) interest rate cut in November, following its initial 50 bps reduction to 4.75%-5.00% last week.
  • Investors are closely watching the upcoming release of the United States (US) Personal Consumption Expenditure Price Index (PCE) data for August.
  • The core PCE inflation data, which is the Fed's preferred inflation gauge, is expected to increase from 2.6% in July to 2.7%.
  • A sustained increase in inflation could reinforce expectations for the Fed to reduce interest rates by 50 bps in November, while a stronger-than-expected reading may dampen those expectations.


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