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Aussie Dollar Falls After National Australia Bank Hikes Home Loan Rates

2019-1-24 14:38:24Basics of Trading
Aussie Dollar Falls After National Australia Bank Hikes Home Loan Rates

The Australian dollar fell against the U.S. dollar on Thursday in Asia after one of the Australian top 4 big national banks, the National Australia Bank (NAB), raised the home loan rates.

The bank said in a statement today that it would increase its standard variable mortgage rate for owner-occupier principal and interest (P&I) customers by 12 basis points to 5.36%.

The NAB was the only one of Australia’s Big Four banks to not lift its mortgage rates last September. The standard variable mortgage rates at the Commonwealth Bank, Westpac and ANZ currently stand at 5.37%, 5.38% and 5.36% respectively.

The news sent the Aussie dollar lower as a rate hike is bad news on the country’s indebted households. The AUD/USD pair last traded at 0.7108 by 12:13 AM ET (05:13 GMT), down 0.5%.

The Australian currency traded higher earlier in the day after data showed its economy added 21.6k jobs in December, beating the estimate of 18.0k.

Meanwhile, the U.S. dollar index was little changed at 95.792 as investors remained cautious amid the ongoing U.S. government shutdown and global economic growth concerns.

On Monday, the International Monetary Fund (IMF) cut its 2019 and 2020 global growth forecasts, citing multiple threats including a bigger-than-expected slowdown in China and the risks of a “no deal” Brexit.

The USD/JPY pair was unchanged at 109.57 after the Bank of Japan kept its policy unchanged on Wednesday.

Elsewhere, the USD/CNY pair edged down 0.1% at 6.7859. The People's Bank of China (PBOC) has set the yuan reference rate at 6.7802 today vs the previous day's fix of 6.7969.