The Reserve Bank of Australia will keep the interest rates unchanged, according to the forecasts of the economists, as the concerns for the global economic recovery prompt the policy makers to support the nation’s economy. The pause in the rates increase may have negative impact on the performance of the Australian dollar, which for now rises.
The S&P 500 index dropped 4.7 percent in August and the MSCI World Index slipped 3.9 percent. Australia’s economic growth likely won’t support the inflation as the boost from the mining industry is offset by the lower government spending. The report showed that the Australian gross domestic product rose in the second quarter of this year with the slowest pace in three years.
The policy makers in Asia and Europe, including the European Central Bank, kept the interest rates unchanged last week to support the economic growth. The speculators bet that the RBA also would leave the rates unchanged at the current 4.5 percent level.
AUD/USD closed at 0.9173 after it opened at 0.9155. EUR/AUD closed at 1.4030 after opening at 1.4076.
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