We can at least be thankful today that the central banks of the US and Canada know what they are doing with the Australian dollar. The battler was slammed to a new low last night in the mid-73s as Janet Yellen hawked-up and Stephen Poloz doved-up, implying other commodity producers may be next.
Yellen had a bet each way in Capitol Hill testimony:
Looking forward, prospects are favorable for further improvement in the U.S. labor market and the economy more broadly. Low oil prices and ongoing employment gains should continue to bolster consumer spending, financial conditions generally remain supportive of growth, and the highly accommodative monetary policies abroad should work to strengthen global growth. In addition, some of the headwinds restraining economic growth, including the effects of dollar appreciation on net exports and the effect of lower oil prices on capital spending, should diminish over time. As a result, the FOMC expects U.S. GDP growth to strengthen over the remainder of this year and the unemployment rate to decline gradually.
