After RBA's policy decisions, Aussie is worst performing major currency

Australian dollar fell in Asian trade against a basket of major rivals, plumbing two-week lows against US dollar and leading major currencies lower after an expected decision by Reserve Bank of Australia.

As expected, the RBA maintained interest rates unchanged for the third meeting in a row in order to monitor the impact of recent interest rate hikes on economic conditions.

AUD/USD fell 1.2% to 0.6382, the lowest since August 25, with a session-high at 0.6464, after rising 0.2% on Monday, benefiting from the decline of the US dollar.

Last week, AUD/USD rose 0.75%, the first weekly profit in seven weeks on short-covering.

Worst Performing Currency 

Aussie is now the worst performing major currencies, after losing 1.2% against US dollar, and 0.9% against both the pound, euro, franc, and yen, while losing over 0.2% against New Zealand Dollar.

RBA

The Reserve Bank of Australia as expected held interest rates flat for the third meeting to monitor conditions better. 

Following the decision, the interest rate gap between Australia and the US still stands at 140 basis points, hurting Aussie's standing. 

The RBA acknowledged the declining inflation rates but asserted prices remain too high and will remain so for some time. 

The RBA cleared opened the way for further policy tightening to bring inflation back to targets. 

The RBA noted the increasing services prices with rents also spiking, while the labor sector tightens, and the economy overall continues to strengthen.