Weaker U.S business spending dampens rate hike expectations
Friday 27th May 2016
The Australian dollar recouped Wednesday’s losses rallying back through 0.72 U.S cents during trade on Thursday. Despite weaker than anticipated private capital expenditure throughout the first quarter the AUD bounced off supports, buoyed by a rebound in oil, to touch intraday highs at 0.7244. Softer than anticipated U.S macroeconomic data and profit taking dampened analyst hopes of a June rate increase as investors adjusted expectations surrounding the path of Fed interest rates. Fed Funds Futures indicated those anticipating a June/July lift off slipped to just 26% down from 34% on Tuesday. With little of note on the domestic docket today attentions turn to preliminary U.S first quarter GDP numbers and Fed Chair Janet Yellen for direction into the close and weekend.