Australia Surprises, Holds Rates Steady
SYDNEY, Australia (
) -- The Reserve Bank of Australia surprised the market Tuesday by leaving its key interest rate unchanged rate at 3.75%.
Australia's central bank was expected to raise the rate by 0.25% for the fourth meeting in a row, according to many surveys of economists.
Gov. Glenn Stevens said the central bank left the rate unchanged because the effects of its previous rate hikes are still unclear, the
Associated Press
reports.
Before the RBA decision was announced, Prime Minister Kevin Rudd said a rate increase would stress family budgets, and urged banks to keep their rate increases in line with the benchmark cash rate,
AP
reports.
The Australian dollar fell as soon as the announcement was made. The S&P/ASX 200 index in Australia rose 1.8%.
-- Reported by Joseph Woelfel in New York.
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