Markets slash Reserve Bank of Australia June rate hike odds after weaker inflation, spending, and jobs data.
AUD/USD retreated to 0.7160 in Asian trading Friday, paring an early gap higher as traders scaled back RBA tightening bets. The shift follows April inflation undershooting forecasts, sluggish consumer outlays, and a cooling labor market, signaling prior rate increases are tempering demand.
Overnight, implied odds of a June hike collapsed from 40% to 15%. Attention now turns to next week’s manufacturing PMI, trade balance, and Q1 GDP for further signals on Australia’s growth trajectory.
Risk sentiment provided limited support as oil prices eased on reports of a tentative US-Iran ceasefire, though investors remain cautious pending final deal confirmation.