AUDUSD fell after the RBA’s decision to cut the rate.
The Australian Dollar retreated against the USD on Tuesday morning. The current quote for the instrument is 0.7043.
During its November meeting, the Reserve Bank of Australia decided to cut its benchmark rate to an all-time low of 0.1% from 0.25%. Investors were expecting it but this fact is still negative for the Aussie.
Apart from cutting the rate, the regulator introduced several stimulus measures. One of them is that the RBA would buy 100B AUD of government bonds with maturities of around five to 10 years over the next six months, with the first auction slated for Thursday. It’s a pretty big expansion of the stimulus program: starting March 2020, the regulator has bought bonds worth approximately 60B AUD.
In addition to that, the RBA will be guided by the bond profitability rate, as it may help be more objective when buying bonds.
As for Its top priority, the regulator named the reduction of unemployment, and the above-mentioned stimulus measures are intended to help in solving this problem.
The RBA’s interest rate is not expected to be increased in the coming years. The last time when the rate went up was 2010.
Orgin: RoboForex
