Aussie Rises after RBA Minutes - 21.8.2012

The Australian currency extended yesterday’s gains after the Reserve Bank of Australia released the minutes of the August policy meeting when it left the benchmark interest rate unchanged at 3.5%. The bank said the monetary policy remains appropriate as “inflation is expected to be consistent with the target and growth close to trend” although international outlook has somewhat worsened. The Aussie rose today from 1.0441 to 1.0517 against the US dollar after reaching last Friday a 4-week low of 1.0410. Since June 1 the Australian dollar has gained almost 9.4% versus the US counterpart. However the minutes did not show that the central bank is extremely concerned about the currency strength despite worsened terms of trade, supporting the pair.