RBA holds key rate at a record low of 0.10% in May, AUD/USD whipsaws


The Reserve Bank of Australia (RBA) board members decided to leave the official cash rate (OCR) on hold at a record low of 0.10% after concluding their May monetary policy meeting,

The RBA maintained its target of 10 basis points for yield on a 3-year Australian government bond.

The central bank also maintained the parameters for the government bond purchase programme, adding that they do not expect these conditions to be met until 2024 at the earliest.

A Reuters poll showed last week, “all but one of 25 economists surveyed see no change to policy at the Reserve Bank of Australia's (RBA) May 4 board meeting. One economist predicted a 5-basis point cut to 0.05%.”

FX implications

The AUD/USD pair popped and dropped but remained within a familiar range around 0.7750 on the expected RBA decision.

The spot was last seen trading at 0.7742, where it was pe-RBA announcement, down 0.24% on the day.

About RBA rate decision

RBA Interest Rate Decision is announced by the Reserve Bank of Australia. If the RBA is hawkish about the inflationary outlook of the economy and rises the interest rates it is positive, or bullish, for the AUD. Likewise, if the RBA has a dovish view on the Australian economy and keeps the ongoing interest rate, or cuts the interest rate it is seen as negative, or bearish.

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Feed news

Are you new to trading or have been trading for a while and you feel stuck?

Try with us!
Become Premium!
   

Latest Forex News


Latest Forex News

Editors’ Picks

EUR/USD extends rally to fresh highs above 1.2180

Dollar’s sell-off accelerates, despite of a generalized dismal mood. Government bond yields surge, stocks plunge as inflation concerns mount. Upbeat German data provide further support to the shared currency.

EUR/USD News

GBP/USD resumes advance, challenges highs in the 1.4150 area

GBP/USD recovered the ground lost and trades near its weekly high, despite a souring market’s mood. UK PM Johnson's announcement of additional easing of restrictions boosted the pound on Monday. BOE Governor Andrew Bailey is set to speak later on.

GBP/USD News

XAU/USD turns south before testing 200-day SMA, tests $1,820

XAU/USD came under strong bearish pressure in early American session. Next critical support for gold aligns at $1,800. Rising US Treasury bond yields and risk aversion weigh on gold.

Gold News

BTC crashes, markets follow suit

The cryptocurrency market experienced a crash as the flagship cryptocurrency tumbled. Although some altcoins are recovering, Bitcoin price is still scrambling to find a support level and might trigger another sell-off soon.

Read more

S&P 500 Nasdaq Day Ahead: Can the Fed stop the red

Equity markets are in the red again on Tuesday as the Fed looks on powerless for now. Inevitable really, things cannot keep going up forever but it is always easy with hindsight. 

Read more

Forex MAJORS

Cryptocurrencies

Signatures