The Australian dollar is falling against the US dollar on Tuesday. The current AUDUSD exchange rate stands at 0.6437.
At its November meeting, the Reserve Bank of Australia decided to raise the interest rate to 4.35% per annum from the previous 4.10%. In its comments, the RBA noted long-term inflation concerns. Naturally, this did not sit well with anyone.
The RBA decision was not surprising for investors. First of all, the regulator does not keep its monetary stance secret, repeatedly saying it will increase the borrowing cost. Secondly, it relies on clear signals that are also evident in the market.
According to the RBA, in the future, it will consider the latest statistics and make decisions based on the data.
Today, the Aussie is under pressure not just from the central bank’s moderate stance but also from the increased risk aversion in the stock market.