Australia is still its rates
Posted by adminRiding the wave of recovery in China, Australia offered a further rise in borrowing costs to prevent a resurgence of inflation. The Reserve Bank of Australia (RBA) raised on Tuesday, its main interest rate a quarter point to 4.25%. This is the fifth increase since October. The higher rate, which surprised the market did bounce the Australian dollar to 0.92 U.S. dollar. The Sydney Stock Exchange reached its highest eighteen months of sitting.
Heavily dependent on commodities, the Australian economy is recovering faster than other OECD economies, thanks to strong demand from Asia, notably China faxless cash advance. In 2009, growth was 3%, while the unemployment rate remained at 5.3% of the workforce. But since the beginning of the year, inflation topped 2%.
The stimulus Chinese 450 billion euros to full advantage to Australian orders, even if the exchange rate weighs on exports. Experts expect interest rates between 5% and 5.25% at the end of the year, which explains the attraction for the Australian currency.