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RBA left interest rates unchanged

Tuesday, Jun 07 2016
The Reserve Bank of Australia (RBA) left its benchmark cash rate unchanged a month after it unveiled a 25 basis point cut, which took rates to their current record low of 1.75%. Australia's 'Big Four' banks and a Reuters poll of economists had anticipated no action on Tuesday after gross domestic product (GDP) for the January-March period expanded 3.1% on-year. It was the fastest pace of acceleration in three years and placed the world's twelfth-largest economy on track to meet the RBA's growth forecast of 2.5 to 3.5% by year-end. 
But that's not to say the RBA will be holding steady for long; persistently low inflation remains a worrisome factor that could lead to further rate cuts this year. In Tuesday's statement, the central bank said inflation was expected to remain low "for sometime" due to subdued growth in labor costs, a prediction shared by several economists.
 
Aussie is currently being traded few points above 0.7340 level. Pair is likely to find support around 0.7280 handle and resistance above 0.7380 level. There will be no major data releases later today.
 
Source: cnbc.com
More in this category: « German Factory Orders fell by 2.0% German Industrial Production up by 0.8% »

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