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Australian dollar doesn't crash on Fed and China rescues


MacroBusiness
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See the latest Australian dollar analysis here:
Forex was anything but boring last night with China moving to rescue stocks, the Fed delivering outright confusion and markets moving to price more deflation. DXY was hit as the Fed moved more hawkish in its statement then more dovish in its press conference. EUR lifted:
Yet it was still not enough to  do anything much for the Australian dollar:
Nor commodities:
EM stocks bounced with the appearance of China’s Plunge Protection Team:
But EM junk is telling a different story. This is all about Chinese tightening and, in particular, Evergrande. Be warned! ....

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Cornered Fed Weighs Dilemma: Market Crash or Runaway Inflation? – Investment Watch


The U.S. economy is at a fork in the road.
One route leads to the return of market fundamentals and sane stock valuations, at the cost of a historic market correction.
The other route leads to runaway hyperinflation that eats up the debt almost as fast as it devours the dollar’s buying power. That would likely cause the dollar to lose its hegemony as global reserve currency 
and bring about a simultaneous market collapse.
Here’s where we are, and where we might be going…
How did we get here?
For the most part, through Fed interventions that suppressed interest rates for the last 13 years, creating artificial demand for U.S. IOUs in the form of bonds, and generally maintaining an “easy money” policy. (And let’s not forget the hundreds of millions of stimulus checks, unemployment extensions, fraud-riddled Payroll Protection Program and the other boondoggles associated with the pandemic lockdown.) ....

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