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On January 11, CICC commented on the US non-farm data. The team believes that the highlight of this time is the recovery of the service industry. The service industry has added 231,000 jobs, which has become the main driving force. Judging from the market reaction, the unexpected non-farm data has pushed the US Treasury bond interest rate and the US dollar to a new high, which is also in line with its judgment since the fourth quarter of last year: it believes that the US dollar is still strong and that interest rate cuts should be "done in reverse". When the interest rate cut is realized, it will be the low point of the US Treasury bond interest rate, rather than continuing to look at the recession and the starting point of the downward interest rate.German Geoscience Research Center GFZ: A 5.5-magnitude earthquake occurred in Ethiopia.On January 11, according to AFP, US President Biden condemned Metas plan to terminate its third-party fact-checking on the 10th, calling the decision "shameful." Biden told reporters at the White House, "This goes against everything America is about." It is reported that after Meta terminates its third-party fact-checking plan, it will switch to a user-written community annotation model. The plan will be implemented first in the United States, replacing the fact-checking service previously conducted by independent third parties.The Dow Jones Industrial Average closed at 41,938.45 on January 10 (Friday), down 696.75 points, or 1.63%. The S&P 500 closed at 5,827.04 on January 10 (Friday), down 91.21 points, or 1.54%. The Nasdaq Composite closed at 19,161.63 on January 10 (Friday), down 317.25 points, or 1.63%.According to CNN: U.S. President-elect Trump met with Meta Platforms (META.O) CEO Zuckerberg at Mar-a-Lago on Friday.

AUD/USD falls approaching 0.7200 despite the former RBA governor's aggressive forecasts

Alina Haynes

Jun 08, 2022 11:59

 截屏2022-06-08 下午12.00.41.png

 

Bears and buyers continue to fight for position around 0.7220-25 as sentiment is mixed and investors remain cautious ahead of the week's big data/events. In doing so, the Australian duo struggles to defend the hawkish remarks of former Reserve Bank of Australia (RBA) Governor Ian Macfarlane.

 

Ex-RBA Governor Macfarlane warned early Wednesday morning about chronically rising inflation and the need to drastically increase interest rates. The former policymaker also stated, "There is sufficient scarcity in Australia and the United States to maintain a high inflation rate."

 

In contrast, China's Vice Commerce Minister Wang Shouwen joined China's Vice Finance Minister Zou Jiayi in reiterating concerns about a global economic downturn and a decline in demand. Recent consensus among policymakers held that the rise of global demand is slowing.

 

It's worth noting that a rebound in US Treasury rates and apprehension ahead of Thursday's European Central Bank (ECB) meeting, as well as Friday's US Consumer Price Index (CPI) for May, tend to stifle the AUD/USD pair's movements.

 

In spite of this, 10-year US Treasury note rates jump two basis points (bps) to 2.99 percent the day after breaking a six-day downward trend. A record decline in the US trade deficit and optimism on the US budget appear to have prompted a recall of US Treasury bond sellers. The US trade deficit for April decreased 19.1 percent from the previous day to USD87.1 billion.

 

Other market optimists were defended by US Treasury Secretary Janet Yellen and optimism for a quicker economic rebound in China. Tuesday, US Treasury Secretary Yellen spoke before the Senate Finance Committee about the Fiscal Year 2023 Budget while stating that the US economy faced problems from "unsustainable levels of inflation" and supply chain disruptions. The official said, "An adequate budget is necessary to support the Fed's efforts to control inflation without damaging the labor market."

 

It should be noted that World Bank (WB) President David Malpass's warning that faster-than-anticipated tightening might force certain nations into a debt crisis akin to that of the 1980s appears to have impacted on the quotation as of late. The risk-negative news from Ukraine may follow a similar trajectory. Politico reported that Ukraine has not yet achieved a deal with Russia or Turkey to enable the safe passage of its grain ships in the Black Sea, casting doubt on a U.N. initiative to build a crucial food corridor.

Technical Evaluation

A two-week-old support line protects AUD/USD buyers at 0.7205. However, the 200-day moving average and the recent top, located around 0.7255 and 0.7285, may challenge the Aussie pair's upside before the bulls regain control.


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