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Tag Archives: interest rate decision

Market had almost priced in an interest rate cut of at least 0.25% some even speculating 0.50%.  However, the sensible cut would be 0.25% and the BOE did not disappoint.

Market was really waiting for whether or not the BOE will announce a larger asset purchase amount to pump more liquidity into the economy post Brexit to help boost the economy.

I decided to place a one leg straddle with the following details: –

GBPUSD:   Stop if Offered at 1.3300, Spot at 1.3325 and SL at 1.3330

As it turned out the interest rate cut didn’t really move the market, but what cause the floor from under the GBP to collapse was the announcement of an increase of 60Bn to the asset purchase program totaling 435Bn (previously, 375Bn).

My trade was triggered at within 5 minutes the GBPUSD was at 1.3172, I squared the position at 1.3185 for a trading profit of 115bps.  Thank you BOE, thank you Carney.

I hope all of us was there at 12:30pm today for RBA’s rate decision?

This meeting of RBA has been getting a lot of noise in the media since the past three weeks.

I decided to buy a AUDUSD Put Option with the following details: –

Strike; 0.7696, Premium; 34bps, Breakeven; 0.7662, expiry 10am NY 4 May

As it turned out, the RBA decided to cut interest rates by 0.25% to 1.75%.  As expected market reacted selling the AUD down aggressively.

Within 15 minutes, I decided to sell the option at 0.7563, locking in trading profits of 99bps!

Thank you RBA.

Trust all of you also managed to capture this opportunity……….(“,).

More drama later into the week…………