Australian dollar lifts as Fed's Powell spooks the doves

Australian dollar lifts as Fed's Powell spooks the doves

Powell's testimony followed weeks of intense speculation in the market that the US central bank would soon slash borrowing costs for companies and consumers in order to fend off an economic slowdown that some say has been a long time coming, but that has been made more likely by the 2019 escalation of the USA trade war with China. Below are some key takeaways, per Reuters.

"Concerns about the strength of the global economy continue to weigh on the U.S. outlook", Mr Powell said.

CPI and PPI are not the Fed's preferred measures of underlying inflation in the US economy - that designation is reserved for the core personal consumptions expenditures (PCE) price index, released by the Bureau of Economic Analysis (BEA).

This means a July rate cut is nearly certain, by at least 25 basis points, maybe even more, but even James Bullard, the noted dove and St. Louis Federal Reserve President in a speech at the same time as Powell's stated that 50 basis points would be "overdone" and that a 2nd cut later in the year should be enough.

"The line "our baseline outlook is for economic growth to remain solid, labour markets to stay strong and inflation to move back up over time" to 2%, suggests to us that any rate cuts will be precautionary and tentative", says James Knightley, chief worldwide economist at ING Group.

Trump and White House economic adviser Larry Kudlow have publicly harangued Powell in recent months over the central bank's reluctance to lower rates in service of the continued growth that Trump will rely heavily on for reelection. A specialist broker can deliver you an exchange rate closer to the real market rate, thereby saving you substantial quantities of currency.

"Fed not only focused on concerns within the US economy, but also took into consideration the global economy, negative impact from trade wars and basically hitting all the right buttons for gold bulls".

The signs of a pick-up in underlying inflation, along with separate data on weekly jobless claims showing the labor market remained solid, curbed financial market expectations of a more aggressive 50 basis point cut at the Fed's July 30-31 meeting.

"Manufacturing, trade and investment are weak all around the world".

Spanish judge rules 43-year-old is son of singer Julio Iglesias
Iglesias has often presented himself as an unapologetic flirt with "an obsession for sex". The ruling from a court in Valencia effectively makes him Iglesias' ninth child.

In his testimony on Wednesday, Powell pledging to "act as appropriate" to defend an economic expansion threatened by trade disputes and a global slowdown.

"We don't have any evidence for calling this a hot labour market", Powell told lawmakers.

"We really have learned though that the economy can sustain much lower unemployment than we thought without troubling levels of inflation".

Asked by Representative Maxine Waters, who chairs the committee, if he would "pack up and leave" if the president demanded it, Powell replied with a curt "no ma'am.

The law clearly gives me a four-year term and I fully intend to serve it".

Traders are now looking forward to Powell's second day on Capitol Hill as well as the release of inflation data, with observers saying a weak reading could revive hopes for a big July rate cut.

Since the middle of May, the dollar index has fallen 1.6%, with the greenback down 2.6% against the yen.

With Fed rate cut odds climbing again, the US Dollar (via the DXY Index) has been knocked lower, keeping the threat of a major US Dollar top in place.

Related News:

  • Human Google contractors able to listen to Assistant recordings

    Human Google contractors able to listen to Assistant recordings

    Amazon recently confirmed that it stores Alexa conversations until customers delete them. Google did not immediately respond to a request for further comment.
    France passes law taxing digital giants in defiance of US anger

    France passes law taxing digital giants in defiance of US anger

    The U.S. investigation got bipartisan support from the top members of the Senate Finance Committee. It will only be applied on outgoing flights and not those flying into the country, Borne added.
    Goodbye, 'Love Bug': The Volkswagen Beetle is going extinct

    Goodbye, 'Love Bug': The Volkswagen Beetle is going extinct

    But don't expect to see this particular Beetle hitting the streets however as Volkswagen plans to keep it for themselves. Introduced for the first time in 1949, Volkswagen went on to sell close to five million Beetles in the U.S alone.
  • R Kelly arrested in Chicago on sex charges

    R Kelly arrested in Chicago on sex charges

    The Sun-Times said Kelly's attorney Steve Greenberg, on Thursday confirmed the arrest, but declined to give details. Facing 15 years for the charge, the Ignition singer was later acquitted by the jury of child pornography charges.
    Assassin's Creed VR, Splinter Cell Coming Exclusively To Oculus

    Assassin's Creed VR, Splinter Cell Coming Exclusively To Oculus

    Obviously, since these are rumors, we invite you to take the information provided with due caution and not take it for granted. A man plays a video game with the Oculus Rift VR headset at the E3 Electronic Expo in Los Angeles, California, June 14, 2016.
    NASA and SpaceX Signed A New Contract for More than $50 Million

    NASA and SpaceX Signed A New Contract for More than $50 Million

    The observatory will be launched aboard a Falcon 9 from Launch Complex 39A in Florida , and liftoff is planned for April 2021. The engineers of IXPE mission assumed that the aircraft will be launched on Northrop Grumman's air-dropped Pegasus XL rocket.
  • Cameron Boyce, 20, died from natural causes: Coroners

    Cameron Boyce, 20, died from natural causes: Coroners

    On Instagram , where Boyce had more than 8 million followers, " Descendants " director Kenny Ortega remembered the young star. Boyce , 20, began acting at a young age and starred in Jessie , Descendants and the Grown Ups movies, among others.
    Free Slurpee Day Returns to 7-Eleven

    Free Slurpee Day Returns to 7-Eleven

    On Thursday, you can get a free small Slurpee drink from 7-Eleven stores any time from 11 a.m.to 7 p.m., no strings attached. Beyond drinks, there are deals on snacks with $1 Big Bite hot dogs, pizza slices, and cherry Slurpee-flavored cookies .
    Man arrested in United Kingdom  after climbing Buckingham Palace gates

    Man arrested in United Kingdom after climbing Buckingham Palace gates

    A man has been arrested after reportedly climbing the front gates of Buckingham Palace while Queen Elizabeth II was inside. A Palace source explained: "Of course this will be a matter of great interest to the Queen ".
  • Tom Watson: Labour's response to antisemitism documentary 'deplorable'

    Tom Watson: Labour's response to antisemitism documentary 'deplorable'

    Labour, which has been braced for the accusations, wrote to BBC director-general Lord Hall to complain ahead of the broadcast . This week three senior peers have quit the Labour whip amid continuing controversy over anti-Semitism within its ranks.
    Dozens injured as Air Canada flight to Sydney hits turbulence

    Dozens injured as Air Canada flight to Sydney hits turbulence

    Flight AC33, a Boeing 777-200 hit "un-forecasted and sudden turbulence" over the Pacific Ocean, according to the airline. The plane was about two hours past Hawaii and turned around to make the emergency landing in Honolulu Thursday morning.
    Seoul denies Japan claim of North Korea sanctions violations

    Seoul denies Japan claim of North Korea sanctions violations

    Japan's envoy in Geneva, Junichi Ihara, countered that the Japanese measures were just a "change of application of procedures". But there's concern that Japan might expand the restrictions to include other sectors.


Most liked

Pooja Batra, Nawab Shah get secretly married; lovebirds now vacationing in Goa
Pooja Batra was the second runner-up at the Miss India pageant in 1993 and she debuted in Bollywood in 1997 film Vishwavidhaata . Nawab Shah posted a Boomerang video, which features a woman's hand, purportedly Pooja's wearing bridal choora .

Call of Duty: Modern Warfare Multiplayer Reveal Date Confirmed
In Gun Game, players rotate through a series of weapons; getting a kill with each one before moving on to the next. Call of Duty: Modern Warfare is scheduled for release globally October 25 on PlayStation 4, Xbox One, and PC.

Amazon India to offer Prime membership at half price to these users
Use price-tracking websites, such as CamelCamelCamel or Keepa, to see how the price of an item has changed on Amazon over time. On top of the Amazon Prime Day PC deals, there are also some other features and benefits to getting involved this year.

AT&T will introduce automatic blocking for robocalls 'over the coming months'
The first way is cumbersome but free, and the second way costs $4 a month but automatically sends the spam calls to voicemail. On Tuesday, AT&T became the first major USA wireless company to automatically block robocalls for its customers.

Attorney General Barr won't recuse himself from NY case against Epstein
Epstein now faces one count each of sex trafficking of minors and of conspiracy to engage in sex trafficking of minors. He added , "I do hear that there were a lot of people involved in that decision - not just him".

Pokemon Sword and Shield trailer shows off new characters
There's Alcremie , a Cream Pokemon; Yamper, a Puppy Pokemon; Rolycoly , a Coal Pokemon; and Duraludon , an Alloy Pokemon. Pokemon has a new trailer for its upcoming Sword and Shield game, with a swathe of new Pokemon and characters revealed.

New Zealand outclass India to reach World Cup final
The Black Caps set India a target of 240 after completing the remainder of their innings, adding 28 runs from 23 balls. But before New Zealand could make further inroads in the game, MS Dhoni and Ravindra Jadeja stopped the rot.

Kanye West turns to Star Wars for low-income housing design
The rapper intends to launch a sustainable shoe made from algae and housing inspired by George Lucas' Star Wars . The concept designs of the homes have been described as " oblong and dozens of feet tall ".

Having too many sugary drinks linked to higher cancer risk
Responding to the study, the American Beverage Association stressed the safety of sugary drinks. Chan School of Public Health who was not involved in the new study, told Business Insider.

Firefighters tackle blaze at Warner Bros UK studio
No cause for the fire at the studios where all eigh Harry Potter films were made has been given by the fire service. The incident began late on Wednesday evening, with nearby residents seeing smoke rising from the lot.

Asia cautious as everything rides on dovish Powell
Japan's Nikkei had also finished lower and Chinese blue chips barely budged as data showed inflation remained stubbornly subdued. Against the dollar, the euro was steady at $1.1208 after hitting $1.1194, which was the lowest in almost three weeks.

Pakistan minister calls former Indian skipper MS Dhoni match-fixer, biased cricketer
Ravindra Jadeja (77) and MS Dhoni (50) added 116 runs for the 7th wicket partnership for India but fell short of the target in the end.

Apple iPhone killer to come with breakthrough technology
Instead, the analysts predict the first notch-free iPhone will come in 2020, with the iPhone 12 series - but not all of them. However an advert released earlier this week, Apple claims that their Face ID is "safer and easier" than Touch ID.

How US Women's Soccer Is Used to Prop Up the Men
The USWNT , which won its fourth World Cup crown on Sunday, has been fighting for equal pay for some time . Allie Long, a midfielder from Northport, New York , posted on Twitter about returning to her home state.

Japanese Deep Space Probe Lands Successfully on Asteroid
The original incarnation collected dust samples from a smaller asteroid, which is described as looking like a potato. The spacecraft first arrived at the asteroid in June 2018 to carry out experiments.