FXstreet.com (Barcelona) - Reserve Bank of Australia has slashed its key interest rate on Tuesday to the lowest level in 64 years, and Japanese Government has announced measures to be taken in order to reactivate the banking system, Asian markets have reacted positively to these measures.
Australian Central Bank has cut its benchmark interest rate by 100 basis points to 3.25%, while, at the same time Prime4 Minister Kevin Rudd announced a $26.5 billion stimulus package aimed to public spending such as infrastructure, schools, and housing, a package which will dip Australian budged into deficit for its first time in ten years.
The Bank of Japan has announced its plan to buy shares worth 1 trillion Yen to shore up their capital, battered by the financial turmoil.
Asian stock markets have reacted positively to these news, specially the Australian S&P/ASX 200 index, which has risen 1.4% on the back of government action to reactivate economy. Tokyo's Nikkei index has added 0.3% after news from BOJ's intervention were released. Hong Kong's Hang Seng Index has climbed 0.6%.
On the currency side it has not been a session of high volatilit6y, the EUR/USD is moving in a range from 1.28 to 1.29, indifferent to weaker than expected retail sales in Germany, after picking up somewhat from eight-week low on Monday.
The Poud has picked up from 1.4050 low reached on Monday to open sone consolidation proces in the range from 1.4170 to 1.4270.