RBA Leaves Rates Unchanged

The RBA has left the official cash rate on hold at 4.75 per cent, marking a six-month pause in policy tightening (the central bank last raised interest rates in November last year). Economists had expected the RBA to leave rates unchanged, despite stronger-than-expected inflation data for the March quarter.RBA governor Glenn Stevens said the "mildly restrictive" monetary policy stance remained appropriate, but warned that the decline in underlying inflation since 2008 had "run its course".

RBI (Royal Bank of India) in a bid to clamp down on resurgent inflation, in its first monetary policy review of 2012, raised repo and reverse repo rates by 50 basis points. This takes repo (rate at which it lends to banks) to 7.25% and reverse repo (rate at which it borrow) to 6.25%. However the CRR (Cash Reserve Ratio) has been left unchanged at 6%.

For the US Dollar, the boost from Bin Laden’s death was short-lived, coming under pressure again, although even as the Euro rally remains strong, bearish correction is very likely as investors are becoming increasingly worry following the ‘True Finns’ party stance yesterday against Portugal’s bailout, which means a possible hold on the bailout from the EU, that needs the agreement of its 17 member states.