Today we have a big day in the Aussie markets with the RBA announcement and the release of the Federal Budget. With the market reacting positively to President Trumps release from Walter Reed Hospital, it seems like an upbeat time for investors. However, after a strong performance on Monday, the AUD/USD pair has retracted by 10 pips in the early session of the Asia trading day on Tuesday.
RBA Interest Rate Decision
Interest rates are expected to remain on hold today as the RBA releases it’s interest rate decision. Although, the expectation is likely, it’s the tone of the statement which our traders will be listening out for. Deputy Governor Guy Debelle recently cited a mismatch between the outlook for inflation and employment with the Bank’s objective.
The Federal Budget
The much anticipated budget is due to be released today. With Tax cuts being brought forward thrown into the mix, it’s no wonder the budget has Australian’s tales wagging.
The key points we know so far
- $7.5 Billion will be fast tracked around the Nation for roads and rail upgrades.
- Aussie Tax cuts which were due to begin in 2022/23 have been brought forward and will be back paid from July 1st 2020. This will be a nice refund for tax payers just before Christmas.
- First home buyers will now be able to buy with a deposit on a property as low as 5%. Down from the previous 20%. Lenders mortgage insurance has been waved on newly built properties. This is a huge leg up for new home buyers in this increasingly expensive market. What a way to keep the Aussie dream alive Treasurer.
- Manufacturing Boost are expected with the government investing an extra $1.5 billion AUD in manufacturing over four years. Sectors that will get the boost are, resources technology and critical minerals processing; food and beverage manufacturing; medical products; clean energy and recycling and space industry.
This is a nice budget for the people and what is usually an eyerolling time of the year, I am sure many more Australian’s will be paying close attention to the budget labelled the most important budget in 100 years.
Stay safe traders. Trade smart, trade to your limits and remember a stop loss isn’t a loss but your safety net to loosing it all.
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