The Reserve Bank of Australia (RBA) left its cash rate steady at 4.50% as expected, saying the global economy had continued to expand, albeit unevenly, with growth in Asia very strong and signs of China moderating to a more sustainable rate.

The EUR and Australian dollar (AUD) rebounded from early losses against the dollar and yen on Tuesday after a statement by the RBA helped dispel some gloom about the economic outlook, which led to short-covering. The Aussie stood 0.4% higher on the day at $0.8437 after earlier dropping to test a support line at $0.8315, a low point set last week.

Against the yen it climbed 0.6% on the day at 74.08 after sliding as far as 72.73. Global risk appetite has taken a beating in the past few weeks on growing worries about the health of the euro zone's banking system, a slowdown in China and risks of a double-dip recession in the United States.