The Australian dollar spiked, moving above US76c, as the Reserve Bank of Australia left the cash rate at a record low 0.1%, while the S&P/ASX 200 declined from the highs made early in the day.
The Reserve Bank of Australia board meeting on Tuesday was the first for Michele Bullock as the newly appointed deputy governor. Economists were not expecting any change in the cash rate.
In a statement after the board meeting, governor Philip Lowe said that inflation has picked up and a further increase is expected, but growth in labour costs has been below rates that are likely to be consistent with inflation being sustainably at target.
"Over coming months, important additional evidence will be available to the Board on both inflation and the evolution of labour costs. The Board will assess this and other incoming information as its sets policy to support full employment in Australia and inflation outcomes consistent with the target," the RBA statement said.
US futures are dipping and markets across Asia are mixed. Markets in mainland China and Hong Kong are closed on Tuesday this week for holidays.
Western Areas remains in a trading halt after the independent expert assessing the $1.09 billion valuation of IGO Group’s bid for the nickel miner said it is not a fair price, according to an ASX statement from IGO. Without seeing the report, IGO said it understood the report did not endorse the $3.36 price that IGO has offered to pay for each share in Western Areas and expects the Western Areas board will reverse the recommendation they made in December, when they encouraged Western Areas shareholders to accept the deal.
WTI currently US$105.67 a barrel
Brent crude oil US$111.51 a barrel
Spot gold US$1927.30 an ounce