| Time | Country | Event | Period | Previous value | Forecast | Actual |
|---|
| 00:30 | Australia | RBA Meeting's Minutes | | | | |
| 03:00 | Japan | BoJ Interest Rate Decision | | -0.1% | -0.1% | -0.1% |
| 07:00 | Switzerland | Trade Balance | November | 3.4 | 3.2 | 2.0 |
During today's Asian trading, the US dollar consolidated against major currencies, remaining near its lowest level since mid-August amid prospects that the US Federal Reserve may begin lowering interest rates next year.
The US Dollar Currency Index (DXY), which tracks the dynamics of the dollar against six currencies (euro, swiss franc, yen, canadian dollar, pound sterling and swedish krona) rose by 0.01% to 102.57. While some Fed officials opposed market expectations about how soon the Fed might cut rates, these comments did little to influence market prices and stop the decline in the US dollar index, which has lost another 0.9% since the beginning of December after a 2.97% decline in November. Investors are now preparing for the release of the core personal consumption expenditure price index (PCE) - the Fed's preferred measure of core inflation - which will provide additional clarity on whether inflation has slowed enough for the Fed to begin easing its monetary policy next year. According to the CME FedWatch Tool, markets see a 65.0% probability of a 25 basis point rate cut at the Fed meeting in March 2024 and a 95.0% probability of a rate cut in May 2024.
The yen fell by 1% against the US dollar after the Bank of Japan left the interest rate at -0.1% and maintained its forward guidance. The Bank of Japan said it would not hesitate to take additional policy easing steps if necessary, and warned that uncertainty about the economy is extremely high. While the meeting outcome was in line with market expectations, some investors were looking for signs of whether the Central bank could signal a possible move away from negative interest rates.
The Australian dollar rose 0.2% against the US dollar, as market sentiment remained buoyant. Meanwhile, the minutes of the Reserve Bank of Australia's December meeting showed that policymakers were considering raising interest rates, but decided there were enough encouraging signs on inflation to pause for more data.