The RBA took markets by surprise at their August meeting by deciding to stick to their planned September tapering despite the virus situation. Can they surprise again?
When we compare the virus situation between right now and what it was back at the start of August, then it seems almost a done deal for the bank to delay their September tapering.
However, if the bank decides that the hit to growth and the economy will be mostly transitory, they could surprise again. The other side of the coin could see that surprise more dovish by not only delaying tapering, but also increasing their weekly QE purchase pace.
Either one of the above scenarios will be important – and we could see some interesting price action. Our focus will be on AUDNZD, AUDZAR, GBPAUD and EURAUD.
As always, there’s in-depth analysis in our week ahead video.