RBA Overview
The Reserve Bank of Australia (RBA) will announce the latest monetary policy decision at 04:30 GMT on Tuesday. The central bank is forecasted to keep interest rates unchanged at a record low of 0.25% and maintain its yield curve control policy (YCC).
Status quo decision likely
"RBA commentary over the past month makes it clear the Board is content with current monetary policy settings. As such, we expect no changes at this week's meeting," TD Securities' analysts said in a research note.
Meanwhile, analysts at Standard Chartered noted that "the RBA's YCC has worked well in anchoring 3Y interest rates; it restarted bond purchases in August, to provide further monetary easing after the re-imposition of lockdowns in Melbourne. We believe the hurdle for further rate cuts or modification of YCC is high; the success of its YCC measures would enable the RBA to stay on the sidelines in the near-term."
And while the central bank is likely to indicate that the coronavirus-induced slowdown has not been as bad as initially feared, it is expected to state that the recovery would be uneven and bumpy.
The focus would be on the central bank's take on the damage caused by the lockdown in Victoria and the exchange rate.
A status quo policy will likely have a negligible impact on the Aussie dollar pairs. That said, the RBA may try to talk down the Aussie dollar, as the AUD/USD pair has risen by nearly 1,400 pips in the past 5-1/2 months. The currency pair could rise further on the Federal Reserve's recent decision to adopt a more relaxed approach to controlling inflation.
About the RBA rate decision
RBA Interest Rate Decision is announced by the Reserve Bank of Australia. If the RBA is hawkish about the inflationary outlook of the economy and rises the interest rates it is positive, or bullish, for the AUD. Likewise, if the RBA has a dovish view on the Australian economy and keeps the ongoing interest rate, or cuts the interest rate it is seen as negative, or bearish.
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
Gold falls amid a possible de-escalation of US-China tensions Premium
Gold pulled back from its all-time high of $3,500 per troy ounce reached earlier on Tuesday, as a resurgent US Dollar and signs of easing tensions in the US–China trade dispute appeared to draw sellers back into the market.
EUR/USD retreats to daily lows near 1.1440
EUR/USD loses the grip and retreats to the 1.1440 zone as the Greenback’s rebound now gathers extra steam, particulalry after some positive headlines pointing to mitigating trade concerns on the US-China front on Tuesday.
GBP/USD deflates to weekly lows near 1.3350
GBP/USD loses further momentum and recedes to the 1.3350 zone on Tuesday, or two-day troughs, all in response to the frmer tone in the US Dollar and encouraging news from the US-China trade scenario.
3% of Bitcoin supply in control of firms with BTC on balance sheets: The good, bad and ugly
Bitcoin disappointed traders with lackluster performance in 2025, hitting the $100,000 milestone and consolidating under the milestone thereafter. Bitcoin rallied past $88,000 early on Monday, the dominant token eyes the $90,000 level.
Five fundamentals for the week: Traders confront the trade war, important surveys, key Fed speech Premium
Will the US strike a trade deal with Japan? That would be positive progress. However, recent developments are not that positive, and there's only one certainty: headlines will dominate markets. Fresh US economic data is also of interest.
The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.