The Australian dollar was holding steady on Tuesday in Asia following the Reserve Bank of Australia decision to cut rates to a historic low of 1.25%.
AUD/USD was trading at 0.6978 by 1:00 AM ET (05:00 GMT). The Australian currency showed little reaction to the RBA’s rate cut decision, which was widely expected.
RBA Governor Philip Lowe said the bank still expected the Australian economy to grow by 2.75% this year and next.
“The central scenario remains for the Australian economy to grow by around 2.75% in 2019 and 2020. This outlook is supported by increased investment in infrastructure and a pick-up in activity in the resources sector, partly in response to an increase in the prices of Australia’s exports,” he said.
Meanwhile, the U.S. dollar index was also holding steady after falling to near a one-week low the previous session on the back of weaker-than-expected manufacturing activity for May.
The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, was last at 97.132.
The USD/JPY pair slipped 0.1% to 107.96.
The USD/CNY pair gained 0.1% to 6.9064.