Tuesday, 7 April 2009

RBA cuts rate, BoJ holds

The Reserve Bank of Australia cut its interest rate today. Bloomberg reports:

Australia’s central bank cut its benchmark interest rate to a 49-year low after policy makers signaled the economy faces its first recession since 1991.

Glenn Stevens lowered the overnight cash rate target by a quarter-point to 3 percent today, as forecast by four of 23 economists surveyed by Bloomberg News. Five expected a half- point reduction and 14 tipped no change.

But the Bank of Japan left interest rates unchanged and is broadening the range of collateral it accepts instead. Again from Bloomberg:

Governor Masaaki Shirakawa and his policy board today decided to accept municipal and central government bonds that are sold directly to investors to ease credit, the central bank said in a statement today in Tokyo. The board held the overnight lending rate at 0.1 percent by a unanimous vote.

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