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RBA's Kent: Not overly concerned about level of AUD
AUD is on the move as the USD weaknes in Asia and Reserve Bank of Australia says not overly concerned about level of A$ and that it is not far from fundamentals.
Key notes
- Reserve Bank of Australia assistant gov Kent says short end of yield curve has a close correlation to the A$.
- Says watching three-year yields closely, would buy more if yields move away from 25 bps.
- Says negative rates would not be helpful in current circumstances.
- Says negative rates would hurt bank profitability.
- Says new monetary policy measures would come with costs.
- Says new policy measures not under consideration.
- Says room for further growth in RBA balance sheet.
- Says A$ is not far from fundamentals.
- Says not overly concerned about level of A$.
Market implications
These comments over the currency are the sorts the markets were looking for and will go along way to underpinning the currency vs the US dollar in decline.
The currency is printing fresh highs for the session to 0.7122 as the DXY sinks 0.25%.
Author
Ross J Burland
FXStreet
Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.
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