Australia Surprises With Rate Hike!!!!!!!!!!!!!!!!!

Discussion in 'Economics' started by S2007S, Nov 2, 2010.

  1. S2007S

    S2007S

    Australia Surprises With Rate Hike; Currency Jumps
    Reuters | November 01, 2010 | 11:52 PM EDT

    Australia's central bank increased its key cash rate by 25 basis points to 4.75 percent on Tuesday, a surprise to many given inflation had moderated and credit growth remained weak.

    The Reserve Bank of Australia (RBA) made the announcement following its monthly policy meeting.

    A Reuters poll had shown that analysts were expecting rates to stay steady, with rates only going up in December.

    Then rise marks RBA's first move since May, when it ended a tightening spree of six rate hikes in seven meetings to normalize policy following the global financial crisis.The RBA raised rates by 150 basis points in six steps between October and May as the economy recovered quicker than anyone expected.

    The Australian dollar surged on the news, rallying as far as $0.9981, from $0.9885 before therate decision was announced, and on course to test resistance at $1.
     
  2. Maybe the pool of debtors is actually drying up and they need a little head to foment that Fosters to encourage lenders.... in otherwords.. a headfake.
     
  3. drcha

    drcha

    love those Aussies
     
  4. pool of debtors not drying up. But pool of NEW debtors not enough to cover costs involved to keep current course. tune must be changed.
     
  5. We don't drink fosters! Fosters is slang for piss. After a big sess we piss into stubbies and export it to the poms.
     
  6. oraclewizard77

    oraclewizard77 Moderator

    I want to thank you for reporting this. I checked my charts, and placed a limit order for a long trade, then went to the gym. When I got back, I was already out at a very nice profit since I was not able to trade this morning due to over sleeping.

     
  7. LOL at the "unexpected" remark. There has been basically zero reaction in the Aussie short term interest rate futures market - which should be the most directly affected market ... this move was expected and totally priced in. As for the currency, it wasn't that big of a move up in the AUD - we've been seeing 100 pip intraday moves nearly every day for weeks. Just a thought, but I would expect the AUD to retrace all of this move by the end of the trading day in New York.