The Australian dollar is sharply lower today after today’s RBA interest rate decision and monetary statement where they left the door open for further rate cuts if needed.

At 6.19pm (GMT) the Aussie dollar was trading at US75.25c falling from around US76.10c before the announcement.

The RBA kept rates on hold today at 2 percent but the monetary statement reflected a worry over inflation and the soaring Aussie dollar which led many to believe that a rate cut was on the cards in the nearest future.

 “The clear implication is that a further gain in the value of the Australian dollar could cause the RBA to act on its bias to cut interest rates again.” noted Shane Oliver, head of investment strategy and chief economist at AMP Capital

Before the RBA’s interest rate decision, local data released to the market failed to impress investors with import and export figures failing to meet expectations and Australia’s trade deficit hit $3.4 billion, well above expectations for a number of $2.5 billion.

The Australian dollar is expected to remain subdued until tomorrow’s minutes meeting from the US Federal Reserve where the central banks tone is likely to choose the direction of the Aussie.