Australia holds interest rate at 3.75%

[mserve id=”Central_Bank_RBA.jpg” align=”left” width=”450″ caption=”Reserve Bank of Australia” alt=”Reserve Bank of Australia RBA” title=”Reserve Bank of Australia”] Australia’s central bank has surprised the markets by keeping interest rates on hold at 3.75%.

Most analysts had been expecting rates to rise to 4%, and news of the rate freeze sent the value of the Australian dollar falling.

Australia has largely escaped the worst effects of the banking crisis, and the Reserve Bank of Australia has raised rates three times since October.

However, the central bank hinted that more rate rises may be needed.

“If economic conditions evolve broadly as expected, the board considers it likely that monetary policy will, over time, need to be adjusted further in order to ensure that inflation remains consistent with the target over the medium term,” said Reserve Bank of Australia (RBA) governor Glenn Stevens.


For more Australian Economic Indicators visit FXEconostats

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza