Ella 
In early Asian trading on Thursday, AUD/USD consolidated above the psychological mark of 0.6500. The U.S. dollar’s decline and markets maintaining a risk environment have provided some support for AUD/USD. More Fed speakers are scheduled to speak later on Thursday and Friday, while economic data releases this week are quieter. As of press time, AUD/USD was trading at 0.6520, up 0.02% on the day.
Several Fed spokesmen agreed with the idea that interest rate policy should be guided by economic data and that interest rates should be maintained at higher levels longer. On Wednesday, Federal Reserve Governor Adriana Kugler said that inflation is showing signs of a solid slowdown but that she is not yet ready to start cutting interest rates. Meanwhile, Minneapolis Fed President Neel Kashkari said the Fed needs more time to maintain confidence in inflation before starting to cut interest rates. Kashkari suggested that based on current data, two or three rate cuts in 2024 seem appropriate.
Boston Fed President Collins said the likelihood of inflation exceeding 2% has diminished, while noting that the road to the 2% target may be bumpy. Collins said more evidence was needed to consider cutting interest rates. The speech had little impact on markets compared to what we heard at Fed Chairman Powell’s press conference.
In terms of the Australian dollar, the Reserve Bank of Australia (RBA) kept interest rates stable on Tuesday and said it would not rule out the possibility of further interest rate increases because inflation remains too high. Futures market traders expect the first easing from the Reserve Bank of Australia is likely to come in September rather than August. This in turn boosts the Australian dollar and acts as a tailwind for AUD/USD.
Next up, China’s consumer price index (CPI) and producer price index for January will be released on Thursday. If the above data is weaker than expected, it may cause some selling pressure on the Australian dollar. In addition, Thursday will also see the release of U.S. weekly jobless claims, wholesale inventories and a speech from Federal Reserve Chairman Barkin (Richmond).
