Dollar Won't Depreciate Till Mid 2019, CBA's Grace Says

The video discusses the market's reaction to Jay Powell's speech, focusing on the Fed's monetary policy and its impact on the dollar. It explores the trade picture's influence on the dollar outlook, the depreciation of China's RMB, and the trends in the Australian and New Zealand dollars. The discussion highlights the factors affecting currency values, including interest rate differentials and economic growth reassessments.

What is the Fed's preferred measure of the real neutral Fed funds rate?

• Labash Williams measure

• Phillips Curve

• Taylor Rule

• Fisher Equation

How do the slowing economies of Germany, Japan, and China affect the US dollar?

• They cause the US dollar to fluctuate wildly

• They weaken the US dollar

• They strengthen the US dollar

• They have no effect on the US dollar

What is the expected impact of a significant improvement in the trade picture on the US dollar?

• Significant appreciation

• Complete dislocation from other currencies

• No major change

• Significant depreciation

What has caused China's currency to depreciate recently?

• Rising inflation rates

• Current account deficit and negative interest rate differentials

• Increase in foreign investments

• Strong economic growth

What is the current account status of China for the first time in more than a decade?

• Current account surplus

• Current account deficit

• Balanced current account

• Current account surplus with a deficit trend

What is the main risk for the Australian and New Zealand dollars in relation to China's currency?

• Stability regardless of China's currency movements

• Depreciation as China's currency weakens

• Appreciation due to China's economic growth

• Complete dislocation from China's currency

What recent economic data has supported the Australian and New Zealand dollars?

• Decline in commodity prices

• Third quarter labor market report and higher terms of trade

• Decrease in interest rates

• Reduction in trade deficits