Greenback is Soft as Rate is Untouched

Market Reviews

The greenback remained soft as Fed didn’t change its rate at the yesterday’s meeting. The currency follows Swiss Franc, which has significantly declined. Fed left federal funds rate objective at 1-1.25%. Members claimed that balance sheet tapering is likely to be started in September. Core inflation projection was decreased. Thus, the USD index hit the minimum of thirteen months. DOW rose 97.58 points (0.45%), reaching the maximum of 97.5.

Philip Lowe (RBA governor) cautioned that weak wage growth is becoming a much bigger problem. He said that if wage growth rises, inflation will hit its target. Lowe sees benefits in low interest rates, claiming that such policy increases jobs. The Governor also would like to lower the exchange rate.

Australian import price index fell -0.1% qoq in the second quarter. Germany will publish Gfk consumer sentiment and Eurozone will announce M3. Britain will issue CBI realized sales and the US will show durable goods orders, trade balance and jobless claims.