The Australian Dollar dropped. Overview for 07.09.2021

AUDUSD was quite emotional in its response to the RBA’s comments.

The Aussie dropped pretty much against the USD on Tuesday. The current quote for the instrument is 0.7411.

During its September meeting, the Reserve Bank of Australia decided to keep the benchmark interest rate intact at its all-time low of 0.10%. This decision was expected, so market players were not surprised.

At the same time, in the comments, the RBA confirmed its intentions to reduce the global QE program because it was expecting a quicker economic recovery in the near future. According to the regulator, the main reason for that is the vaccination campaign effect.

As we mentioned above, the RBA is planning to decrease the weekly QE volume from A$5B to A$4B. Another decision implies that the program will continue the stimulus program until mid-February 2022. Market players immediately forgot everything that was said before and perceived the last announcement as “rather soft”.

Investors did have such expectations: they really thought that the RBA might postpone the reduction of the QE program until better days because of lockdowns in Sidney, Melbourne, and other big cities in Australia. However, the regulator said that the outbreak of the delta strain would postpone the economic recovery but not sabotage it.