Sentiment Data Points to Likely ECB Rate Hold, RBA Cut

  • Monday, June 3, 2019

Welcome to “The Cyborg Analyst” by Prattle. This report provides weekly, quantitative insights on G-10 currency central banks.

The Most Important Central Bank Releases This Week
central bank communications analytics research

As the calendar rolls from May to June, G10 currency central bankers are significantly ramping up their rhetoric. In a very active week, nine Fed policymakers will deliver a total of 10 speeches, with both Chairman Powell and NY Fed President Williams likely to move markets in their respective speeches on Tuesday. While Fed policymakers are likely to remain slightly dovish in an attempt to calm financial markets, they might want to take some lessons from BOE policymakers, who have been combating Brexit risks for what seems like an eternity. This week is no different, with BOE policymakers attempting to strike a balance between warning markets of potential dangers and signalling their readiness to combat those dangers. The tone from the BOJ is strikingly similar, if somewhat more dovish, as policymakers continue to combat sluggish inflation and search for ways to boost growth.

The ECB and RBA are both holding policy meetings this week that are likely to move markets. The ECB is likely to err dovish and signal stimulus is nearing on the horizon, while the RBA is likely to cut rates 25bps in light of further declines in economic data across the board.

This is an abbreviated version of the Cyborg Analyst. The full weekly report contains detailed analysis based on Prattle’s Central Bank Analytics. 

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