Aussie at Parity, RBA Board Minutes - 15.5.2012

The Reserve Bank of Australia decided on May 1 to cut the target cash rate by 0.5% to 3.75%. Today the Bank published the minutes of the policy meeting, which confirmed only a modest economic growth pace in early 2012. The minutes also indicated that inflation in the March quarter was lower than expected, falling to 1.6% over the year, and projections suggest that the "expected outlook for inflation is somewhat lower than the previous forecast made in February". "The central estimate was for GDP to grow by around 3 per cent over 2012 and 2013, although employment growth was expected to remain subdued in the near term", according to the minutes. The aussie fell yesterday below parity against the US counterpart for the first time in 2012 and touched early in the morning the level 0.9945. By the beginning of the European trading session however the pair rose toward parity, reversing yesterday’s losses.