An exerpt from DailyFX Asia Session...

An exerpt from DailyFX Asia Session Highlights

http://www.dailyfx.com/story/dailyfx_reports/Euro_Market_Open/Swiss_Franc_Volatility_Likely_As_1245299586904.html


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"Separately, data from the Reserve Bank of Australia showed that the central bank sold A$1.4 billion of the local currency in the spot forex market in April, the most in five years. The same month saw the Australian dollar gain a whopping 6.4% against a trade-weighted basket of top currencies, suggesting the bank is actively working to counteract upward pressure on the Aussie from a rebound in risky assets over the past three months. Indeed, the RBA’s currency sales have surged by A$1.2 since March when stock markets found a bottom and began to reverse course higher. A stronger currency threatens the export sector, making Australian goods comparatively more expensive for overseas buyers. Perhaps most notably, the RBA said that the influence of changes in benchmark interest rates on bank lending rates has weakened over the past two years, suggesting monetary policy is losing potency in stimulating economic activity. On balance, this suggests deeper cuts than what has already been undertaken may be needed to bolster the economy in the months ahead. Minutes from the last policy meeting confirmed that Glenn Stevens and company are leaving the door open for additional easing."