RBA pumps liquidity, proposes bond buys to ease financial conditions, AUD/USD rallies 2%
|The Reserve Bank of Australia, on Tuesday, injected A$6.9 billion ($4.06 billion) into the financial system and announced it would buy A$4 billion in government bonds to cushion the economic blow from the coronavirus crisis.
On Monday, the RBA bought A$4 billion ($2.3 billion) in local government bonds, as a part of its quantitative easing (QE) programme announced last Thursday.
The total number of cases in Australia jumped to almost 1,900 on Tuesday while industry experts believe that a recession in the OZ economy for the first time in 30 years is inevitable despite the fiscal stimulus measures.
AUD/USD reaction
The Aussie is benefiting the most from broad-based US dollar weakness and an improved market sentiment amid global central banks’ pumping in liquidity to ease the economic concerns.
Further the Fed’s unlimited QE decision led rally in gold prices is also adding to the upside in AUD/USD, as it now trades near 0.5940 region, up nearly 2% on the day.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.