AUD/USD Surges to 0.8870 after RBA Drops Easing Bias

The Australian dollar stole the limelight on Tuesday, surging over half a U.S. cent after Australia’s central bank surprised some traders by dropping its bias towards easing rates.

The Aussie’s sharp jump came just as the yen eased back from a two-month high versus the U.S. dollar, though its losses were tempered by fragile sentiment after a disappointing reading on U.S. factory activity stirred concerns about the outlook for economic growth.

The shift to a more neutral policy setting by the Reserve Bank of Australia (RBA) was announced along with a widely expected decision to keep the main cash rate unchanged at a record low of 2.5 percent.

Reuters

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