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Australia leaves rates at 2.5%

  • As expected, the Reserve Bank of Australia has left its key overnight cash-rate target at a record low of 2.5%.
  • RBA Governor Glenn Stevens said the Australian dollar is "uncomfortably high" and needs to fall for the country to achieve balanced growth.
  • "The RBA is certainly using stronger language," says HSBC economist Paul Bloxham. "I think they're really trying to jawbone the Aussie dollar lower if they can.
  • Still, markets don't expect a rate move in the next half year, especially with low borrowing costs boosting house prices.
  • The AUD-USD is -0.3% to $0.9483, while the S&P/ASX 200 is +0.8%. (PR)
  • ETFs - Stocks: EWA, EWAS, KROO, AUSE, FAUS. Bonds: AUD, AUNZ. Currency: FXA, GDAY, CROC.
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