Australia’s central bank said households’ response to easy monetary policy was “unusually uncertain” and it saw an advantage in waiting for more economic data before deciding on further rate reductions. It also warned the nation’s business investment outlook could weaken.
“Members considered that the current setting of monetary policy was accommodative and providing support to the economy,” the Reserve Bank of Australia said in minutes of its April 7 board meeting, where it left the benchmark rate at a record-low 2.25 percent. “They noted that the responsiveness of borrowers and savers to changes in interest rates and asset prices was unusually uncertain in a world of very low interest rates and high household leverage.” The RBA maintained an easing bias.
The central bank, which is trying to engineer a transition in growth drivers from resources to other sectors, said mining investment fell 13 percent in 2014 and was likely to drop by more this year. It noted the oil price decline could prompt “some scaling back” of oil and gas sector spending and said liaison and forward indicators suggested non-mining investment “was likely to remain subdued, and could even decline, over the next year or so.”
Recommended Content
Editors’ Picks
AUD/USD holds above 0.6500 in thin trading
The Australian Dollar managed to recover ground against its American rival after AUD/USD fell to 0.6484. The upbeat tone of Wall Street underpinned the Aussie despite broad US Dollar strength and tepid Australian data.
EUR/USD comfortable below 1.0800 lower lows at sight
The EUR/USD pair lost ground on Thursday and settled near a fresh March low of 1.0774. Strong US data and hawkish Fed speakers comments lead the way ahead of the release of the US PCE Price Index on Friday.
Gold pulls away from daily highs, holds above $2,200
Gold retreats from daily highs but holds comfortably above $2,200 in the American session on Thursday. The benchmark 10-year US Treasury bond yield stays near 4.2% after upbeat US data and makes it difficult for XAU/USD to gather further bullish momentum.
Google starts indexing Bitcoin addresses
Bitcoin address data is live on Google search results after users realized on Thursday that the tech giant started indexing Bitcoin blockchain data. However, mixed reactions have followed the tech giant's reversed stance on the cryptocurrency.
A Hollywood ending for fourth quarter GDP
The latest revisions put Q4 GDP at 3.4%, the second fastest quarterly growth rate in two years. Much of the upside was attributable to stronger consumer spending, yet fresh profits data affirmed it was a good quarter for the bottom line as well with profits up by the most since the Q2-2022.