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RBA on hold | Chinese liquidity injection

Published February 5, 2020

by George Hopkinson

The AUD was the best performing currency overnight as it rebounded from 4 month lows. The RBA held rates steady and retained their economic outlook despite the impact of the bushfires and the coronavirus epidemic in China. The cash rate is held at a record low of 0.75 percent, a widely expected decision given a recent decline in unemployment.

Boosting the AUD further was the decision by the Chinese central bank to inject USD242.74 billion via reverse repos on Monday and Tuesday. This helped Chinese stocks pare back some of the hefty losses. The move helped ease fears of a heavy economic impact from the coronavirus epidemic.

In the US, adding further optimism was data that showed new orders for US made goods rose to near 1-1/2-year highs in December.

Upcoming data today includes NZ Unemployment rate, however Aussie traders will be focused on the speech by RBA Governor Lowe where he’s expected to give the central banks outlook for 2020.

 

 

 

Adam Nikitins and Stewart McCallum were appointed Joint and Several Voluntary Administrators of EncoreFX (Australia) Pty Ltd on 30 March 2020.

Rees Logan, Adam Nikitins and Stewart McCallum were appointed Joint and Several Voluntary Administrators of EncoreFX (NZ) Limited on 30 March 2020.

Any queries regarding the Administrations should be directed to encorefx@au.ey.com.