The
Australian dollar rose slightly during Thursday's trading, despite the Reserve
Bank of Australia's Monetary Policy Committee decision to keep interest rates
unchanged to support the Australian economy in the face of the spread of the coronavirus.
The
AUDUSD pair is currently trading higher at 0.6429 after hitting a high of
0.6430, noting that the session’s opening price was recorded at 0.6423.
The
Australian dollar's rise came despite the RBA's decision to maintain current
monetary policy measures, including keeping the interest rate at 0.25%, in line
with market expectations.
According
to the basic scenario, Australia GDP would decline by about 10% during the
first half of 2020, and by about 6% for the whole year, followed by a recovery
of about 6% over the next year.
However,
in different RBA scenarios, inflation remains below 2% over the next few years.
The
statement also showed the RBA will not raise interest rates until progress is
made in the economy, and as inflation starts creeping towards its 2-3% target
range.
Governor
Philip Lowe hopes for a stronger recovery in Australian economy if there is "more substantial
progress in containing the coronavirus in the near term and there is a faster
return to normal economic activity."
As
for the latest developments in the Coronavirus, Australia recorded 6,847
infections and 96 deaths, while New Zealand had 1,137 cases and 20 deaths.
Meanwhile,
the dollar index, which measures the performance of six major currencies
against the US dollar, advanced 0.35 percent at 99.92, as the rise in US-China
tensions raised safety demand.
It is worth
mentioning that the Aussie dollar has been on the rise versus its U.S. counterpart
since hitting a trough at 0.5509 on March 19.