RBA Rate Decision
Written March 1, 2010 at 10:39 PM EST by Alex Chernomordin
The market anticipated a 25 basis point hike in the Australian interest rate and the market got it this time around as the RBA raised rates to 4%. The AUD/USD pair quickly popped to .9031, however has since moved below the 90 cent handle as this hike has been built into the price for sometime. The accompanying comments from the RBA did not help the AUD sustain its early bid, the comments were as follows:
- Expansion still hesitant in major countries.
- Growth likely to be close to trend.
- Many countries have ongoing excess capacity.
- Appropriate for rates to be closer to average.
- Growth in Asia continued to be quite strong.
- Today’s increase a step toward average rates.
- Home loan approval moderated in recent months.
- Concerns regarding some sovereigns remain elevated.
- Dwelling prices have risen significantly over the past year.
- Australia 2009 economy stronger than expected.
- Lenders becoming more willing to lend.
- Australia’s jobless rate appears to have peaked.
- Economic growth has been close to trend for a few months.
- Growth in Aussie economy at or close to trend.
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