RBA statement affects dollar
The Reserve Bank of Australia kept interest rates unchanged at a record low of 3% as expected in their latest policy statement. As a result, the Australian dollar firmed up to USD0.7960, up from Monday's close of USD0.7912. The Reserve Bank is showing a slightly more optimistic tone with the increased likelihood that rates will not be cut again this cycle.
Despite the optimism, the US dollar and euro have weakened some of the gains made by the Australian currency during the local session. However, the current view is that the outlook for inflation allows some scope for further easing of monetary policy.
The RBA's decision to keep interest rates steady has the Australian dollar's exchange rate at GBP0.4917 and EUR0.5710.
The rates quoted above are interbank rates. Client rates may vary according to the volume and timing of the trade.