The Australian dollar is slightly higher following a quiet night of trade ahead of the Reserve Bank of Australia’s interest rate decision.
At 0700 AEST on Tuesday, the local unit was trading at 78.37 US cents, up from 78.28 cents on Monday.
Twelve out of the 15 economists surveyed by AAP last week expect the RBA to cut the cash rate to a new record low of two per cent on Tuesday, after the bank made a similar reduction in February.
All but three of them say the interest rate won’t go any further below two per cent for the foreseeable future.
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National Australia Bank economist David de Garis said trade in most most currencies was subdued overnight with very little economic data to drive movements.
“A night of recent ranges as far as the major currencies was the order of the overnight session, the Australian dollar was marking time ahead of the RBA decision today at 2.30pm,” he said.
“The market closed yesterday with 75 per cent priced for an easing today so the price risk would be more on the upside of yields and the Australian dollar in the event the RBA holds fire.”
Before the RBA announcement the Australian Industry Group releases its Performance of Services Index (PSI) for April and the Dun and Bradstreet business expectations survey is due out.
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