Australian dollar gains after PM re-elected
The Australian dollar was up 0.5% on Monday after Australian prime minister Scott Morrison was re-elected in a shock win federal election
The Surprise election victory by the Liberal party gave the Aussie a boost against the Greenback, while the yen dipped slightly.
The dollar index against a basket of six currencies was largely steady at 97.970 , its biggest weekly rise since early March last week.
Australian dollar price
The Aussie was at $0.6904 on Monday after bouncing from a four-month trough of $0.6865.
It comes after, Prime Minister Scott Morrison's Liberal National Coalition won the federal elections, beating the centre-left Labor party, who were expected to win.
The Aussie also found support off the back of a statement from China's central bank on Sunday, saying it would maintain the stability of its yuan.
The New Zealand dollar also edged higher, climbing up to $0.6530, away from a seven-month low of $0.6514.
RBA rate cuts
Rate cuts have been priced in, as investors brace for Reserve Bank of Australia (RBA) Governor Philip Lowe's speech on Tuesday, where the analysts say a rate cut is likely.
It comes after the central bank said an easing might be needed if the labour market did not stay strong. National Australia Bank (NAB) economist, David de Garis says after last week’s soft readings on the labour market, an RBA rate cut is expected in June.
"The numbers pointed to a risk that labour market spare capacity will not reduce, putting the RBA's getting back to target inflation forecast at risk," he said.
The futures market implies a 62% chance of a quarter point cut in the 1.5% cash rate when the RBA board next meets on June 4. A move is almost fully priced for July and a further cut to 1% is baked in by December.
IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.
The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.
Please see important Research Disclaimer.
Start trading forex today
Trade the largest and most volatile financial market in the world.
- Spreads start at just 0.6 points on EUR/USD
- Analyse market movements with our essential selection of charts
- Speculate from a range of platforms, including on mobile
Live prices on most popular markets
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.