RBA, China boosts Australian dollar

from MoneyTrading.com.au

The Australian dollar advanced on Monday after the Reserve Bank of Australia sounded a hawkish warning over interest rates. Glenn Stevens, RBA governor, said Australian interest rates had been too low and warned it would not be ”wise to leave interest rates down at rock bottom” any longer than was necessary. Underlining the RBA’s growing discomfort with rising house prices, Mr Stevens warned people against thinking they could get rich by speculating on rising property prices.


The comments heightened expectations that the RBA would raise interest rates further at its policy meeting on April 6. The central bank has raised rates four times since October, taking its main lending rate to 4 per cent.

Also boosting the Australian dollar and other commodity-linked currencies, were bullish comments from Yu Bin, a Chinese government economist, who said growth in China could be as high as 12 per cent in the first quarter