Australia cuts official interest rate by full 1%

Aussie


Joined: 17/06/2007
Posts: 657

Message Posted:
07/10/2008 13:16

Yen slips as RBA cut stirs talk of global action





* October 7, 2008 - 2:59PM

*



The US dollar and the euro jumped to session highs against the yen on Tuesday after Australia's central bank slashed interest rates by a full percentage point, stirring talk of coordinated central bank action to stem the worsening credit crisis.



The US dollar rose as much as 0.8% from late US trade to a high of 102.62 yen, up sharply from the six-month low of 100.22 yen hit the previous day. The euro climbed 0.8% to 138.60 yen, up from a three-year low hit on Monday.



One trader at a European bank in Hong Kong said the RBA move "opens the discussion'' of whether the Federal Reserve, European Central Bank and Bank of England cut could rates aggressively as well.



However, Japan's central bank today said it was holding its key interest rate steady at 0.5%, as fresh turmoil erupted on global financial markets.



Wires