investingLive Asia-pacific market news wrap: RBA introduces a clear hawkish bias | investingLive
Markets:
- Gold flat
- WTI crude oil down 21-cents to $58.67
- US 10-year yields up 0.4 bps to 4.17%
- S&P 500 futures up 0.1%
- Nikkei up 0.2%
- AUD leads, CHF lags
The RBA decision was the main event of the day and it put some life into the FX market. The kneejerk was lower in AUD/USD but only for a minute as it quickly rebounded to 0.6625. The market was perhaps looking for more of a hawkish signal that wasn’t there in the statement but it certainly appeared with Bullock, who said the board envisioned staying on a long pause or hiking and that cuts weren’t envisioned. She also singled out the upcoming meeting in February as one where they will be looking carefully at inflation data, though the market still only sees a 25% chance of a hike.
Further out, we now have nearly 2 rate hikes priced in for 2026 and that’s led to a climb in AUD/USD to 0.6640, about 20 pips above the levels before she spoke.
Elsewhere, we are seeing some USD/JPY strength kick in as the pair trips stops above 156.00 and touches the best levels since Dec 2. Notably, that Dec high of of 156.18 is in range and Treasury yields are higher again.
Aside from that, the ranges have been tight in FX and global equities. Gold perked up earlier but couldn’t get through $4200 and has now slipped to $4185.