The Australian dollar fell today as the rally of the US dollar and the sell-off of the euro hurt riskier currencies. The passive stance of Australia’s central bank was not helping the currency.
The Reserve Bank of Australia released its quarterly Statement on Monetary Policy today. Unlike its New Zealand counterpart, the Australian central bank did not see a material chance of an interest rate cut, anticipating higher rates in the future:
Higher interest rates are likely to be appropriate at some point, if the economy continues to evolve as expected.
With that said, the bank also reiterated that it is not in a hurry to start raising rates:
Given the gradual nature of the improvement, however, the Board does not see a strong case to adjust the cash rate in the near term.
AUD/USD dropped from 0.7371 to 0.7306 as of 10:14 GMT today, and its daily low of 0.7280 was the lowest since January 2017. AUD/JPY declined from 81.88 to 81.10, touching the low of 80.77 intraday.
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