Yahoo Finance Aussie Dollar Gains After RBA Keeps Rates Unchanged
Investing.com - The Australian dollar gained against its U.S. counterpart on Tuesday in Asia after the Reserve Bank of Australia (RBA) kept the cash rate on hold.
The official interest rate was kept on hold at 0.75%. “The main domestic uncertainty continues to be the outlook for consumption, with the sustained period of only modest increases in household disposable income continuing to weigh on consumer spending,” RBA governor Philip Lowe said. “Other sources of uncertainty include the effects of the drought and the evolution of the housing construction cycle.”
The AUD/USD pair last traded at 0.6899 by 12:40 AM ET (04:40 GMT), up 0.2%.
Meanwhile, the USD/CNY pair slipped 0.1% after a private survey showed China’s services sector activity expanded at its slowest pace in eight months in October as new orders slowed and business confidence hit a 15-month low.
The Caixin/Markit services purchasing managers’ index (PMI) slipped to 51.1 last month, matching February’s low and edging down from September’s 51.3.
Separately, the People’s Bank of China slashed the interest rate on its medium-term lending facility on Tuesday for the first time since early 2016.
The rate was lowered by 5 basis points to 3.25% from 3.30% previously.
The USD/JPY pair gained 0.2% to 108.80. The Bank of Japan (BOJ) kept policy steady but tweaked its forward guidance to say the central bank will maintain ultra-low rates or even cutting them for as long as needed.
BOJ Governor Haruhiko Kuroda said “(The new forward guidance) does not limit additional monetary easing measures to rate cuts.”
“There is no change to our understanding that, besides lowering policy rates, there are various possible measures for additional easing,” he said in a speech.
On the Sino-U.S. trade front, Washington and Beijing indicated late last week that progress had been made on agreeing to a trade deal, with U.S. officials indicating that a deal could be signed this month.
Bloomberg cited people familiar with the plans and said that Chinese leader Xi Jinping might travel to the U.S. to sign deal.
The U.S. Dollar Index that tracks the greenback against a basket of other currencies inched up 0.1% to 97.425.
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