NEWS | 05/07/2024
- AUD/JPY struggled after the RBA decided to keep the policy rate unchanged at 4.35% on Tuesday.
- Analysts from Commonwealth Bank and Westpac forecast that the RBA’s interest rate could have reached its peak at 4.35% in November 2023.
- The safe-haven JPY faced challenges due to the prevalent risk appetite.
AUD/JPY trades around 102.20 during the Asian trading hours on Tuesday. The Australian Dollar (AUD) faced a challenge after the Reserve Bank of Australia’s decision to keep interest rates steady at 4.35%, as anticipated during Tuesday’s meeting. This decision is likely influenced by the recent Australian inflation data surpassing expectations last week.
Australia experienced a decline in inflation during the first quarter, marking the fifth consecutive quarter of deceleration, despite surpassing initial forecasts. Furthermore, the country’s monthly CPI indicator surged in March, contrary to market expectations of stagnation.
Analysts at Commonwealth Bank and Westpac predict that the RBA’s interest rate might have peaked at 4.35% in November 2023, before gradually declining to 3.10% by December 2025.
Meanwhile, the risk-on sentiment persists, exerting pressure on safe-haven currencies such as the Japanese Yen (JPY). Masato Kanda, Japan’s top currency diplomat, hinted at possible measures to address excessive market fluctuations earlier on Tuesday.
Last week, the Japanese Yen (JPY) saw appreciation amidst speculation of government intervention by Japanese authorities. Reuters reported data from the Bank of Japan (BoJ) suggesting that Japanese authorities might have allocated around ¥6.0 trillion on April 29 and ¥3.66 trillion on May 1 to bolster the JPY.
What this means for Australian > Japanese Investors
The article discusses recent developments impacting the AUD/JPY currency pair and their implications for Australian-Japanese investors. The Reserve Bank of Australia (RBA) decided to maintain interest rates at 4.35%, which was expected given the positive inflation data from Australia. However, analysts predict a gradual decline in interest rates to 3.10% by December 2025. This stability and potential future rate adjustments could influence investment decisions for Australian investors considering opportunities in Japanese markets.
On the other hand, the Japanese Yen (JPY) has been affected by measures to address market fluctuations, with Japan’s currency diplomat suggesting intervention to manage excessive volatility. Recent actions by Japanese authorities to bolster the JPY through interventions amounting to substantial funds could impact currency exchange rates. For Australian-Japanese investors, this dynamic between the RBA’s monetary policy and Japan’s efforts to stabilize the JPY against risk-on sentiment highlights the importance of monitoring currency trends and economic policies for investment strategies spanning both countries.
AUD/JPY
| Overview | |
|---|---|
| Today last price | 102.41 |
| Today Daily Change | 0.43 |
| Today Daily Change % | 0.42 |
| Today daily open | 101.98 |
| Trends | |
|---|---|
| Daily SMA20 | 100.59 |
| Daily SMA50 | 99.31 |
| Daily SMA100 | 98.25 |
| Daily SMA200 | 96.81 |
| Levels | |
|---|---|
| Previous Daily High | 102.05 |
| Previous Daily Low | 100.98 |
| Previous Weekly High | 105.04 |
| Previous Weekly Low | 99.93 |
| Previous Monthly High | 105.04 |
| Previous Monthly Low | 97.78 |
| Daily Fibonacci 38.2% | 101.64 |
| Daily Fibonacci 61.8% | 101.39 |
| Daily Pivot Point S1 | 101.29 |
| Daily Pivot Point S2 | 100.59 |
| Daily Pivot Point S3 | 100.21 |
| Daily Pivot Point R1 | 102.36 |
| Daily Pivot Point R2 | 102.74 |
| Daily Pivot Point R3 | 103.44 |