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DailyFX Forex Radio - US Dollar Softens As UK Inflation Pressures Persist, RBA Remains Hawkish
By DailyFX Radio | February 11, 2008
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Fundamental Headlines
• AUDUSD – The release of the RBA’s Quarterly Monetary Policy Statement reiterated the bank’s hawkish bias. While the statement noted that the bank “had to take into account sharply contrasting domestic and international developments,” the RBA remained focused on “uncomfortably high” inflation risks and commented that “(a)bsent a further shift in economic risks to the downside…monetary policy is likely to need to be tighter in the period ahead.” For more news and resources, visit the new Australian Dollar Currency Room.
• GBPUSD – UK producer price input costs rose 2.6 percent from December and pushed the annual rate up to 19.1 percent, which is the highest level in nearly 28 years. Meanwhile, output price growth accelerated quite a bit, with the monthly rate jumping 1 percent to bring the annual rate up to a 16-year high of 5.7 percent. The news will not be of comfort to inflation hawks on the BOE’s MPC, especially ahead of tomorrow’s CPI release. However, much of the increase is a result of sky-rocketing petroleum product prices during the month, as oil hit a record high of $100.09/bbl on January 3. As a result, we could see inflation-related figures start to fall lower in coming months, as energy price gains have moderated since then. Discuss the topic and your trade ideas in the GBP/USD Forum.
Podcast by Terri Belkas, Currency Analyst, Forex Capital Markets LLC, DailyFX.com
Contact: tbelkas@dailyfx.com
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