LevelMagazine – AU – RBA keeps rates close to zero, ASX jumps after record in November


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At its board meeting today, the Australian central bank kept its official rate target at 0. 1 percent.

Last month the RBA cut rates to near zero and increased its quantitative easing program by promising long-term government bonds worth $ 100 billion. USD to buy in addition.

In his post-meeting statement, RBA Governor Philip Lowe said the country’s economic recovery depends on continued government and central bank support.

« Given the outlook for employment and inflation, monetary and fiscal support will be needed for some time, » he said

« The board will continue to review the scope of the bond purchase program, particularly given the evolving outlook for jobs and inflation. « 

Meanwhile, Australian stocks have rallied in afternoon trading and bullish investors extend November vaccine-induced rally.

At 15. 3 p.m. AEDT, the benchmark ASX 200 jumped (1. 3pc) to 6. 601. The broader All Ordinaries Index also rose a similar margin to 6. 824 points.

As trade and political tensions ease, speculation is stirring up about what is really going on between the two nations – and what is next on a Chinese « hit list » for sanctions. .

Some of the top performers were gold miners Sandfire Resources (Sept.. 9 pieces), Perseus Mining (4. 7pc) and Regis Resources (6. 8pc), together with Domino’s Pizza (11. 9pc) and Collins Foods (10. 8pc).

On the other hand, Unibail Rodamco Westfield (-2. 7 pieces), Woodside Petroleum (-1. 1 piece), Bank of Queensland (-0. 7pc) and IDP Education (-2. 8pc) were the weakest performers.

Last month, the Australian market rose 10 percent after three drug companies, Pfizer, Moderna and AstraZenca announced solid vaccination results, raising investor hopes for a quick economic recovery.

It was the strongest month ever for the ASX 200 (since it was launched in 2000) and the All Ords’ best monthly win since March 1988.

The company’s regulator is suing Commonwealth Bank for doing more than 2. Overloaded 200 customers on their current account.

National property prices continue to withstand the otherwise devastating effects of the coronavirus pandemic, but how long will this take? asks Nassim Khadem.

However, the Australian Securities and Investments Commission (ASIC) will claim in federal court that the CBA more than doubled them (around 34 percent). .

ASIC claims the bank put an additional $ 2 in its pocket. 9 million as a result of this « system failure » between December 2011 and March 2018.

The regulator said CBA tried unsuccessfully to manually fix the overcharge problem in 2013 but continued to charge excessive interest for the next five years.

Essentially, the largest bank in the country is accused of breaking at 12. 119 opportunities to have committed misleading or misleading behavior and to have failed to meet their obligations under the Financial Services Act.

Commonwealth Bank and ANZ stocks rose 1. 5 percent each, while Westpac (1. 1pc) and NAB (0. 9pc) also made solid gains.

The S&P 500 fell (-0. 5pc) on 3. 622, while the tech-heavy Nasdaq slipped (-0. 1 piece) up to 12. 199 points.

« I would attribute (decline on Monday) to mounting concerns about the coronavirus, along with the market just trying to digest some of last month’s recent gains, » said Sam Stovall, CFRA chief investment strategist.

« If you are sprinting and you are out of breath, you need to slow down to catch your breath. « 

Shares in US-listed pharmaceutical giant Moderna soared (20). 2pc) after plans to apply for an emergency permit for the COVID-19 vaccine in the US and Europe were announced.

Even so, the Dow Jones climbed 11. 8 percent in November, the largest monthly gain since January 1987.

S&P and Nasdaq had their best month since April, jumping 10. 8 and 11. 8 percent.

Many European markets also finished their best month ever, such as France (21 percent) and Italy (26 percent). .

Experts say the government’s move to include four different COVID-19 vaccines is « wise, » but warn of significant hurdles that must be overcome before they can be distributed across the country.

This has led AMP Capital’s chief economist Shane Oliver to issue a warning that « the stock markets are overbought and there is a risk of a short-term pause ». .

« However, a larger uptrend is likely as the momentum is very strong. We are now in a seasonally strong time of year for the stock markets, « he said.

« Investors have yet to completely rule out the potential for a very strong rebound in growth and earnings over the next year as the stimuli combine with vaccines. « 

« Cyclical recovery stocks like commodities, industrials and financials are likely to outperform relatively as they have lagged through the pandemic, and this should benefit the Australian stock market versus US stocks. « 

A major victim of the riskier asset rush was gold, which was near a five-month low and lost more than 5 percent in the past month.

A 40 percent drop in Australian house prices is an « extreme but plausible » scenario, according to the RBA.

Spot gold has fallen (-0. 4 pieces) on 1. $ 780. 60 an ounce as the demand for safe havens subsided.

In contrast, the price of oil rose almost 20 percent in November. It was largely driven by hopes that fuel demand and air travel would increase due to a potential COVID vaccine.

Some profit-taking was initiated early Monday ahead of an OPEC meeting to decide whether the oil cartel will extend major production cuts.

In the meantime, iron ore (1. 6pc) to $ 131. 63 per ton, the highest level in almost seven years.

This service may contain material from Agence France-Presse (AFP), APTN, Reuters, AAP, CNN and the BBC World Service that is copyrighted and cannot be reproduced.

AEST = Australian Eastern Standard Time, 10 hours before GMT (Greenwich Mean Time)

Reserve Bank of Australia, central bank, interest rate, official interest rate, monetary policy

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Ref: https://www.abc.net.au


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