| Time | Country | Event | Period | Previous value | Forecast | Actual |
|---|
| 04:30 | Australia | Announcement of the RBA decision on the discount rate | | 3.85% | 3.60% | 3.85% |
| 05:30 | Australia | RBA Press Conference | | | | |
| 06:00 | Germany | Trade Balance (s.a.), bln | May | 15.7 | 15.5 | 18.4 |
| 06:45 | France | Trade Balance, bln | May | -7.7 | -7.7 | -7.8 |
AUD advanced against other major currencies in the European session on Tuesday, as investors continued to price in the Reserve Bank of Australia’s unexpected decision to leave its benchmark rate - the official cash rate (OCR) - unchanged at 3.85%.
Investors and economists had widely expected the RBA to lower the OCR by 25 basis points at its July policy meeting.
In the accompanying policy statements, the RBA’s policymakers noted that the “outlook remains uncertain” and they chose to wait for “a little more information to confirm that inflation remains on track to reach 2.5% on a sustainable basis.”
Meanwhile, the RBA’s governor Michele Bullock said today’s rate decision was about the timing of a move, rather than the direction. “I understand that people had expected there might be a rate cut today, my message to them is, provided that we are on top of inflation, then yes, there is an easing cycle coming,” she added.
Markets also continued to assess the potential impact of U.S. President Donald Trump's newly announced tariffs on global growth and inflation.
As a reminder, the U.S. leader began sending out letters threatening higher tariffs to key trading partners. Specifically, Japan and South Korea, received notices of 25% tariffs on their exports to the United States, South Africa of 30% tariffs, Indonesia of 32% tariffs, Bangladesh of 35% tariffs, Thailand and Cambodia of 36% tariffs.
On the positive side, the higher tariffs were claimed to take effect starting August 1 if better trade terms for the U.S. could not be worked out before then. A three-week extension of the “grace period” for tariff negotiations somewhat calmed investor nerves.