The Australian dollar was trading half a percent stronger today, and it was the best performing major currency during the London session.
The Reserve Bank of Australia did not cancel its taper decision, despite Australia’s fresh round of lockdowns. This is because the RBA still expects the economy to improve sharply once the lockdown is over (if that time ever comes..).
From other news, the US ISM Manufacturing Index for July disappointed yesterday, printing 59.5, below expectations and reflecting a slowing of the current expansion in the manufacturing sector.
US stocks stumped yesterday, failing to push to new highs as the Fed’s Waller warned that if we (the Fed) get good jobs data in the next two months, then The Fed will “taper early and fast” and would “taper MBS faster”.
However, the dip was bought, and all major indices were trading higher on Tuesday.
US yields dropped sharply on Monday, sending the 10-year yield back below 1.20, undermining the USDJPY pair, which slid toward 109.