Currencies  |  December 04, 2012 13:48:30

Australia cut interest rates, AUD unresponsive

Australia's central bank (RBA) last night cut its interest rate by 25 points to 3 percent. The main reason is to combat the economic slowdown. It has benefited from the mining industry, which next year should reach its peak and then rather weaken. The strong Australian dollar as RBA zbrzďuje economy and lower interest rates should lead to weakening of the domestic currency.
Australian interest rate was reduced from May of this year a few times. Over the last half year overall decrease of 125 basis points (1.25 percent) and got the same value, which was at the time of the global financial crisis in 2009.

Humiliation interest rates are expected to have previous meeting RBA, Australian dollar, therefore, to reduce interest rates significantly react. Shares on the Stock Exchange in Sydney recorded a slight decline.

The slowdown in the mining industry

Australian analysts admitted that těžařskému industry, which accounts for more than half of GDP, out of breath, and so the other sectors in the economy will have to show better results.
"The urgency of the situation in finding other than investments in heavy industry has become very acute," admitted Brian Redican of Macquarie Bank.
Redican added that the Australian Reserve Bank will have to take further action. In 2013, we should see further reductions in interest rates.
Down the main problem is falling demand for commodities from China, where the economy has started to slow.

The Australian dollar (AUD)

One of the primary reasons lowering interest rates is weakening the strong Australian dollar. This is due to significantly higher interest rates (3%) as compared with those of other developed economies (EUR - 0.75% USD 0.25%), an attractive investment destination. Strong AUD then causes problems for exporters not only commodities, but also other sectors such as tourism and manufactory.
From a technical perspective it can be seen that the Australian dollar against the U.S. holds in a narrow band. This pair ratio remains readable. 16th 11th offered us a beautiful long position after creating pinbaru the swing low and we stopped to resistance at 1.0480. The figure shows also the formation of "head and shoulders", which sent the pair to 1.0400 Reviews Support. Currently the Australian dollar strengthens and it is very likely that today windblown to resistance 1.0480, above which could last to close in September.

Important fundamentals will later this week in the middle of quarterly GDP and the unemployment rate on Thursday.

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Austrálie snížila úrokové sazby, AUD nereaguje

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