Aussie moves lower against U.S. dollar in forex tradingThe Reserve Bank of Australia decided to keep the interest rate at 3% in its announcement today. The Aussie has moved lower against the U.S. dollar in [B]forex trading[/B] since the news.
However, there is speculation about how long the RBA will keep rates so low. In August there was concern voiced about raising rates as an economic stimulus exit strategy. GFT’s [B]Kathy Lien [/B]remarks in FX360 on the concerns voiced by the RBA:
The policy making board talked about the risks of leaving rates too low for too long. The central bank did not go so far as to say when they would raise rates however but their [B]increased hawkishness is in line with a central bank that is gearing up for a rate hike[/B].
It might take some time for Australian rates to rise, though. Australia depends a great deal on China to buy some of its resources (especially copper and other metals) for industrial purposes. [B]Until things truly pick up in China, there might not be a need to raise interest rates[/B] – and it will be some time before the Aussie makes large gains against the U.S. dollar in forex trading.
[B]See Also[/B]
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[li]Aussie in Forex Trading[/li]Forex trading with world currencies
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