RBA ends Quantitative Easing

Source: Dukascopy Bank SA
On February 2, the Reserve Bank of Australia revealed its future monetary policy by issuing a statement. In general, the bank revealed that it would end its quantitative easing program via bond buying. Meanwhile, interest rates were left unchanged.

Quoting the statement: "At its meeting today, the Board decided to maintain the cash rate target at 10 basis points and the interest rate on Exchange Settlement balances at zero per cent. It also decided to cease further purchases under the bond purchase program, with the final purchases to take place on 10 February.

The Omicron outbreak has affected the economy, but it has not derailed the economic recovery. The Australian economy remains resilient and spending is expected to pick up as case numbers trend lower. The RBA's central forecast is for GDP growth of around 4¼ per cent over 2022 and 2 per cent over 2023."

Released Document

Statement by Philip Lowe, Governor: Monetary Policy Decision

On the release, the AUD/USD currency exchange rate dropped 36 base points or 0.50%. Namely, the market took in the news as a weakening of the Australian Dollar. However, by 07:00 GMT, the rate had recovered to trade near 0.7070.

On a larger scale, the pair is recovering after finding support in the 0.7000 mark.

Initial Reaction

Larger scale situation

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Thu, 03 Feb 2022 12:27:44 GMT

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