PERTH: The Australian dollar rose further against the other major currencies in the late Asian session on Tuesday after the Reserve Bank of Australia maintained its key interest rate at a record low, as widely expected by economists.
The policy board governed by Glenn Stevens decided to leave the cash rate at 2.00%. The bank lowered the rates by 25 basis points each in February and May.
The board judged that leaving the cash rate unchanged was appropriate at this meeting.
“Further information on economic and financial conditions to be received over the period ahead will inform the Board’s ongoing assessment of the outlook and hence whether the current stance of policy will most effectively foster sustainable growth and inflation consistent with the target,” the bank said in a statement.
The currency rose earlier following the release of better than expected trade and retail sales data for June.
Data from the Australian Bureau of Statistics showed that Australia posted a seasonally adjusted merchandise trade deficit of AUD2.933 billion in June, expanding 10% on month. That was smaller than the AUD3.00 billion shortfall expected by economists and follows the upwardly revised AUD2.677 billion deficit in May.
Exports were up AUD830 million or 3.0% on month to AUD26.348 billion. While, imports climbed AUD1.086 billion or 4.0% to AUD29.281 billion.
Also, the ABS said that the total value of retail sales in Australia was up a seasonally adjusted 0.7% on month in June, coming in at AUD24.346 billion. That beat forecasts for an increase of 0.4%, which would have been unchanged from the May reading following an upward revision from 0.3%.
