Fed Chair's dovish pivot just strengthened AUD 58 basis points - here's why

Jerome Powell's Jackson Hole speech hit the dollar harder than a margin call on a Friday afternoon. The Fed Chair's dovish comments about labor market risks have traders pricing in 58 basis points of rate cuts by year-end, sending the US Dollar Index tumbling from its recent 98.20 peak faster than retail investors abandoning their "diamond hands" strategy.

Meanwhile, Australia's inflation data decided to crash the easing party with a surprise 2.8% year-over-year reading in July, well above the expected 2.3%. This unexpected strength has the Reserve Bank of Australia thinking twice about Septe...