Markets in recovery phase, RBA keeps rates on hold
Markets have recovered from yesterday’s turmoil, with most currencies trending back towards the levels we saw last week as some consolidation kicks in. Notably, the JPY is already 1.0% softer, nearly 2% weaker than the lows traded in Monday’s session. With the same breath, the Nikkei and Topix reversed most of yesterday’s losses, closing close to 7% up in both cases after the Nikkei recorded its most significant loss since the 1987 Black Monday crash.
The Reserve Bank of Australia (RBA) kept rates on hold this morning. Overall, the RBA is expected to be the last among G10 central banks to start cutting interest rates. The Aussie has also clawed back some of the losses from yesterday’s session. Commodity prices have also benefited from the improved risk factor, with Oil prices surging 1% thus far.
The Rand opened below the R18.50 handle this morning after risk sentiment improved in the early morning hours. We will still take our cues from global risk sentiment and could expect volatility to remain for the days to come.
