Will Risk Appetite Overshadow Interest Rate Decisions?

Will Risk Appetite Overshadow Interest Rate Decisions? Investors started this week with concerns about how FED policy will change. The Dow Jones Industrial Average fell more than 300 points, and while these declines are often due to signs of economic weakness, potential policy changes in response to rebounds could also dampen market sentiment. The Reserve Bank of Australia and the Reserve Bank of New Zealand have monetary policy statements this week and optimism is expected from both central banks. The Reserve Bank of Australia will be in first place with a monetary policy announcement this evening. It is not expected to make any dramatic changes as there will most likely be a third-quarter contraction. However, in its last meeting, it decided to continue by reducing its asset purchases. The Reserve Bank of Zealand is ready to raise interest rates. In August, Christian Hawkesby said it was difficult to raise interest rates on the day the country was quarantined, but officials were considering a 50 basis point increase. With most of the restrictions eased, the central bank can move forward with tightening, but a smaller 25 basis point score is expected. Friday's U.S. and Canadian jobs reports will also strengthen both central banks' reduction plans. Federal Reserve Chairman Jerome Powell has made it clear that they are prepared to cut back on asset purchases and that this month's jobs report will not stand in the way of the central bank. Job growth is expected to accelerate and the unemployment rate likely to drop to 5%. Job growth is expected to slow slightly in Canada, but like the US, the unemployment rate should drop and the Bank of Canada should keep its contraction plans on track. The Canadian dollar was one of the best-performing currencies of the day, largely thanks to oil jumping more than 2.5% to three-year highs. The US dollar, on the other hand, tumbled against all major currencies despite weak share prices and higher yields.     Will Risk Appetite Overshadow Interest Rate Decisions? Source: Investing.com You may also be interested in: What If You Invested $1,000 In Bitcoin In 2013?