The Australian dollar rebounded from one-month lows on Tuesday while bill futures plunged after the central bank surprised some by not cutting interest rates, although it left the door open for future moves.
The Reserve Bank of Australia (RBA) held rates at 3.25 percent at its monthly policy meeting, confounding expectations for a cut of at least 25 basis points, saying Australia's economy has enough stimulus for now to avoid the depths of recession seen elsewhere.
The Aussie jumped to a high of $0.6411 after the decision, off a one-month low of $0.6288 struck offshore, and compared to $0.6332 seen here late Monday. It gained against the yen as well to 62.34 yen, from Monday's 61.69.
Investors scurried to pare back the speed and scale of any further easing by the RBA, hammering interest futures. April interbank futures sank to 97.05, down 0.25 points, implying the market now looked for not much more than a quarter point cut next month. June futures now have rates at 2.5 percent, compared to 2.0 percent just a few weeks ago.
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