Peter Switzer - The Reserve Bank cuts interest rates to 1%

AUD  USD and NZD  USD Fundamental Weekly Forecast – US-China Trade News Bullish on Paper RBA Rate Cut Priced-in

Radio. "We're 100% behind income earners getting an extra boost in their pay packet".

Though central bank officials are divided on the timing of the next policy move, market gauges of interest rates have increased the odds of an ECB cut later this month, thanks to a global drop in bond yields. Recent figures show that unemployment has risen steadily over the past months, sitting at 5.2%.

"It would be unrealistic to expect that lowering interest rates by one-quarter of a percentage point will materially shift the path we look to be on".

The RBA's visit to Darwin comes a little over 51 years after the last board meeting in the city that's closer to Jakarta than Sydney.

"It will assist with faster progress in reducing unemployment and achieve more assured progress towards the inflation target", the bank said.

At an global level, manufacturing took another knock at the end of the second quarter, signaling a worsening economic growth outlook that could force the world's major central banks into action.

The Australian economy faces global headwinds and local challenges, including the impact of the drought and flooding, soft consumer spending and rising unemployment.

This game of economic catch-up at the RBA is the result of a number of "errors and misjudgments" made by policymakers in 2018, writes PerCapita economist Stephen Koukoulas, and these errors include a "starry-eyed" view of the economy, a willingness to use monetary policy as a brake on house prices and an incorrect assumption that steady interest rates mark financial stability.

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The president openly claimed he has made more progress with the North Korean government than Obama did in eight years. North Korea has said in previous negotiations that sanctions relief is a necessary precondition to any sort of deal.

There has been a glimmer of light in the past month as the June cut in rates and a proposed relaxation of mortgage lending rules injected some much needed life into the housing market.

The Australian dollar nursed wounds on Tuesday, a day after it posted its biggest one-day fall in more than two months ahead of an expected central bank easing while improved risk appetite supported the greenback.

The Pound Australian Dollar (GBP/AUD) exchange rate will, however, remain sensitive to political developments surrounding US-China trade discussions and the ongoing Tory leadership race.

"The government expects all banks to pass on the benefits of sustained reductions in funding costs", he said in a statement on Tuesday.

"Today's decision to lower the cash rate will help make further inroads into the spare capacity in the economy".

The New Zealand two-year swap rate was at 1.3345 per cent from 1.3451 late yesterday, while the 10-year swap rate was at 1.7725 per cent from 1.7900 per cent.

While AUD/USD has dipped back into the region of 0.69 again this week, the pair has regained nearly half of the losses seen yesterday and still trends much closer to the weekend's 0.70 interbank level than last week's levels.

At home, an easing of lending rules combined with the well-flagged prospect of rate cuts may have begun to encourage buyers back into the housing market, with Sydney property prices rising for the first time in nearly two years in June.

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