AUDUSD surges above 0.6660 in advance of PBOC monetary policy
As investors await PBOC's interest rate decision, AUDUSD has attracted bids near 0.6660. The PBOC may be compelled to adopt an expansionary stance if the number of Covid-19 cases continues to rise and the real estate market remains unstable. Fed Bostic anticipates the end of the 75 bps rate hike era and a modest 100 bps increase in the future.

After finding support near 0.6660 during the early Asian session, the AUDUSD pair has risen. Earlier, the asset suffered as investors fretted ahead of the People's Bank of China's interest rate decision (PBOC).
The market lacks prospective catalysts for decisive action, therefore the risk drive remains subdued. Meanwhile, the US dollar index (DXY) is seeing momentary resistance near 107.00 as investors await the release of US Durable Goods Orders data.
President of the Atlanta Federal Reserve (Fed), Raphael Bostic, foresees the end of the 75 basis point (bps) rate hike regime in the near future, which could have a negative impact on the returns on US government bonds.
According to Reuters, a Fed policymaker stated on Saturday that he is prepared to "walk away" from three-quarter-point rate hikes at the Fed's December meeting. He stated that the Fed's target policy rate will not increase by more than one percentage point to combat inflation. After that, the Fed would need to pause and "let the economic dynamics play out," since it may take between 12 and 24 months for the impact of rate hikes to be "completely recognized."
On Monday, the PBOC's monetary policy decision will be closely observed. China's central bank may adopt an expansionary posture as economic estimates have fallen due to the spread of the Covid-19 virus. In addition, weak real estate demand would necessitate the injection of additional capital into the economy. Notably, Australia is China's top trading partner, and a rate decrease decision by the PBOC would benefit Australian bulls.
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