Article by ForexTime
The Reserve Bank of Australia held its benchmark interest rate at 2 per cent.
The RBA last cut rates in May, taking the benchmark interest rate to a historic low of 2 per cent. It also trimmed rates in February.
The Reserve Bank of Australia made only a few slight adjustments to the language in its October policy statement.
There’s very little in today’s statement that would, in isolation, suggest the RBA is warming to a potential future rate cut than it was last month. Indeed, the Australian dollar has leapt as much as 0.6 per cent to US$0.7122 – the highest level since September 22 – on the decision to keep the cash rate steady.
Today, the RBA said:
Free Reports:
“Equity market volatility has continued, but the functioning of financial markets generally has not, to date, been impaired.:
Comparing to September’s observation:
“Equity markets have been considerably more volatile of late, associated with developments in China, though other financial markets have been relatively stable.”
Chinese markets certainly have calmed down over the past month, with the large daily swings and late rallies occurring relatively less than a few months ago. Still, the RBA knows the Chinese sharemarket is generally less of a problem than the overall health of the economy, and on that front, the central bank maintained the language that there had been “some further softening in conditions in China and east Asia of late, but stronger US growth.”
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