Australia's central bank warned of speculative demand in the country's real estate sector, triggered by record low interest rates, signaling that further monetary policy easing is unlikely in the near term. The Reserve Bank of Australia (RBA) issued the statement Tuesday in the minutes from its latest policy meeting on September 2, when it kept interest rates at 2.5 percent for a 13th straight month.
"For investors in housing, the pick-up in housing credit growth had been more pronounced than for owner-occupiers, with investor demand particularly strong in Sydney and to a less extent in Melbourne," RBA said. "Members further observed that additional speculative demand could amplify the property price cycle and increase the potential for property prices to fall later," it added.
Australia's home prices have risen more than 10 percent so far this year, driven especially by demand for investment properties. On the Australia dollar, the RBA maintained that the currency remains "above its fundamental value," despite the Aussie's recent dramatic fall against the U.S. dollar, dipping below the 90-cent handle this week for the first time since March.
Recommended Content
Editors’ Picks
AUD/USD remains under pressure above 0.6400
AUD/USD managed to regain some composure and rebounded markedly from Tuesday’s YTD lows in the sub-0.6400 region ahead of the release of the Australian labour market report on Thursday.
EUR/USD faces decent contention around 1.0600
The knee-jerk in the Greenback reignited some buying interest in the risk complex and pushed EUR/USD to three-day highs near 1.0680, rapidly leaving behind the recent yearly low around 1.0600.
Gold eases despite risk-off mood
Gold trades in a relatively tight range near $2,390 in the second half of the day on Wednesday. In the absence of high-tier data releases, investors keep a close eye on headlines surrounding the Iran-Israel conflict.
Ethereum trades around the $3,000 support following a surge in validator queue
Ethereum (ETH) continued a sideways movement on Wednesday as investors seemed to be waiting for an upward or downward price catalyst. Despite the price stagnancy, the ETH validator queue - possibly fueled by the DeFi restaking boom - rose sharply.
Markets stabilize after Powell rules out rate hike, but the signs don’t look good
Markets are volatile right now; however, a relative calm has descended on the market and US. US stocks are down a touch, but the Vix is lower, US Treasury yields are lower, and the dollar is mostly lower vs. its G10 FX counterparts.