Reserve Bank Of Australia Cuts Interest Rates

The RBA rate decision which was widely expected to be a 100 basis point cut from 4.25% to 3.25% came in as expected. The expectations were relatively split as a large number of economists surveyed predicted only a 75 basis point cut, perhaps keeping the Aussie bid throughout the session. The RBA released the following comments accompanying the release:

• Significant deterioration in World Economy.
• Major economies contracted sharply in the 4th quarter.
• Chinese growth has slowed dramatically.
• Turmoil and global downturn has dampened confidence.
• Inflation has begun to moderate, likely to continue to decline.
• Australian financial system in strong position.
• Rate cuts and stimulus will help cushion economy.

Subscribe by RSS Subscribe by Email