Australian dollar goes berserk on Fed pivot

David Llewellyn-Smith

Thursday 14 December 2023

DXY was hammered last night:

AUD took off though could not hit a new high:

In part thanks to CNY’s concrete boots:

Oil didn’t fall for once. Gold popped:

Base metals meh:

Miners meh:

EM meh:

Junk is screaming up:

Yields are tumbling:

Which is all stocks care about:

The Fed has pivoted dovish. Forward projections all came down:

And the dots opened the a trap door under rates, pricing 75bps in cuts:

My view is it will double that.

AUD up while the market can pretend there is no landing coming.

About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.