Yesterday’s post on Australia and New Zealand cut expectations came true for the RBA.
The Reserve Bank of AustraliaÃ‚Â announced a 100 basis points cut. The official cash rate is now 4.25%. This has been the fourth rate cut since September. The market was expecting aÃ‚Â 75 basis points rate cut in order to decrease the interest rate differential between the current Australian rate 5.25% and the Fed 1.00%. The higher than expected cut temporarily boosted the Australian Dollar and depreciated the New Zealand dollar in early trading.
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