Australian Dollar Drops As Capex Data Fuels RBA Rate Cut Bets
Dailyfx | May 28, 2015 03:45AM ET
Talking Points:
- Australian Private Capital Expenditure Fell 4.4% in 1Q
- Aussie Dollar, Government Bond Yields Sharply Lower
- Soft Figures Likely Inspired RBA Interest Rate Cut Bets
Australian private capital expenditure fell 4.4 percent in the first quarter of 2015, which was the largest decline since the three months through September 2009. The Australian Dollar declined more than 1 percent against its US counterpart. Simultaneously, Australian government bond yields declined, with 3-Year yields down as much as 7 basis points. That suggested that the soft data set weighed on RBA monetary policy expectations, with traders perhaps betting on the resumption of interest rate cuts on the horizon.
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