Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.

The vast majority of retail client accounts lose money when trading CFDs.

You should consider whether you can afford to take the high risk of losing your money.

Important Notice - Fraud awareness
Important Notice - Scam alert
The vast majority of retail client accounts lose money when trading CFDs.
Important Notice - Fraud awareness
Important Notice - Scam alert
Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. The vast majority of retail client accounts lose money when trading CFDs. You should consider whether you can afford to take the high risk of losing your money.
Important Notice - Fraud awareness
Important Notice - Scam alert
The vast majority of retail investor accounts lose money when trading CFDs / Spread betting with this provider.
Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. The vast majority of retail investor accounts lose money when trading CFDs / Spread betting with this provider. You should consider whether you understand how CFDs / Spread betting work and whether you can afford to take the high risk of losing your money.
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GBPAUD Offers Volatility Ahead of RBA Policy Meeting

The Reserve Bank of Australia meets for another policy meeting this week, and traders seeking volatility should consider the GBP v AUD pair. 

Sterling has had its woes after the latest stimulus plans from the government, but the Bank of England's QE restart has boosted the pound.

GBPAUD – 4H chart 

gbpaud 4hour chart

The 4H chart shows that the 1.60 level provided a low before the BoE rally. Traders should look for a peak in the pound and a potential sell opportunity. 

The OECD expects Australian interest rates to hit an 11-year high in 2023 at 3.6 percent as inflation worsens. The international finance group is more worried about rising interest rates than the big Australian banks. 

The RBA has hiked rates over five consecutive months, taking the cash rate in September to a seven-year high of 2.35 percent.

"Further policy rate increases are needed in most major advanced economies to ensure that forward-looking measures of real interest rates become positive, and inflation pressures are reduced durably," the group said. 

"Policy interest rates are projected to rise to 4.5 to 4.75 percent in the United States, 4.5 percent in Canada, and 4.25 percent in the United Kingdom in 2023, reflecting the visible labour market pressures in these countries, and 3.6 percent in Australia." 

The RBA is expected to hike rates by 0.50% at Monday's meeting. During the central bank's previous meeting, Governor Philip Lowe said that the estimated neutral level was 2.50%, which would neither stimulate nor restrict economic activity. 

In a recent Reuters poll, over 70% of economists predicted the RBA would raise its cash rate by half a point to 2.85% this week. The remaining eight analysts forecast a smaller 25 basis point hike. 

"A lot of global interest rate expectations are being set in the United States," said Tony Morris, head of ANZ economics at BofA. 

"If the Reserve Bank doesn't maintain the current pace, then further currency weakness will feed through into a much faster pace of domestic inflation." 

MPs warn UK prime minister Liz Truss she has days to reverse the controversial tax and welfare cuts. Failure in doing so would result in facing a party rebellion that could remove her before Christmas.

Last Updated: 03/10/2022

This market commentary and analysis has been prepared for ATFX by a third party for general information purposes only. Any view expressed does not constitute a personal recommendation or solicitation to buy or sell as it does not take into account your personal circumstances or objectives, and should therefore not be interpreted as financial, investment or other advice, or relied upon as such. You should therefore seek independent advice before making any investment decisions. This information has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. We aim to establish and maintain and operate effective organisational and administrative arrangements with a view to taking all reasonable steps to prevent conflicts of interest from constituting or giving rise to a material risk of damage to the interests of our clients. The market data is derived from independent sources believed to be reliable, however we make no representation or warranty of its accuracy or completeness, and accept no responsibility for any consequence of its use by recipients. Reproduction of this information, in whole or in part, is not permitted.


 

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