News dalla rete ITA

26 Settembre 2022

Australia

RBA TO FOLLOW FED’S LEAD AS AUSTRALIAN DOLLAR HITS 2½ YEAR LOW

Global shares fell, led by Wall Street, and the Australian dollar touched its lowest level since May 2020 after the US Federal Reserve lifted interest rates by another 0.75 of a percentage point and signalled more rate rises ahead.The US dollar index, which measures the greenback against a basket of major currencies, struck a fresh 20-year high of 111.63. The US currency has gained a staggering 16 per cent so far this year as the Fed tries to slay inflation with swift monetary tightening.The Dow Jones Industrial Average fell 1.7 per cent to 30,183.8, S&P 500 dropped 1.7 per cent to 3789.9, and the Nasdaq retreated 1.8 per cent to 11,220.2 points.The Reserve Bank is on track to follow the Fed's lead with an oversized rate increase of its own.“It now seems more likely than not that the RBA will lift rates by 0.5 per cent in October,” said David Bassanese, chief economist at BetaShares. The depreciating Australian dollar is another reason why the central bank would opt for such a large move, he said, as further declines would add to imported inflationary pressures.Interbank futures are fully priced for a 0.25 percentage point lift by the Reserve Bank in October and imply a further 60 per cent chance of a half-percentage-point move, based on the end of night session trading. The ASX and futures markets are shut until Friday for the public holiday mourning the late Queen.The Fed’s new projections show its policy rate rising to 4.4 per cent by the end of the year, before peaking at 4.6 per cent in 2023 to get on top of runaway inflation. The Fed does not expect to cut rates at all next year, contradicting market pricing that is predicated on recession.The Fed funds rate is now set at between 3 per cent and 3.25 per cent – the highest since before the global financial crisis, and up from near zero at the start of this year.Fed chairman Jerome Powell, speaking to reporters, said there is no painless way to bring inflation down, reiterating that it wants to act aggressively now and keep at it. (ICE SYDNEY)


Fonte notizia: AFR 22.09.2022