Australia Keeps Interest Rate at 3.75%

Big news – Earlier this morning Australia’s central bank unexpectedly paused in raising interest rates - as sign that the central bank needed to support the economy’s acceleration and stem inflation later. Of course if you think about it, what we really see here is that things are not getting better “down-under” as fast as we all hope.

Per the chart above, you can see that right after the announcement the AUD took a huge hit on the intra-day. The bank of Australia kept the overnight cash rate target at 3.75% after three increases – a decision that blind-sided most economists and FOREX traders who were expecting a 74% chance of an increase based on futures trading.