07.10.2014 - The RBA expects further reduction in the price of the Australian dollar

Reserve Bank of Australia in its statement announced that it is keeping interest rates at the same level of 2.50%. In addition, it was noted that the inflation rate will remain within the target levels due to low wage growth. Credit growth in the country remains moderate. According to the RBA, the labor market situation of the country remains volatile. Despite the recent drop in prices of the AUD/USD, the RBA still consider that the exchange rate is high. It should be noted that the main risks for the Australian economy remain slowdown in China and low prices for iron ore, which is the main export commodity of the country. In this regard, and amid strengthening of the dollar, we expect a fall in price of the Australian dollar, with targets at 0,86-0,85.

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