Australia as China's Canary Means World Watching RBA's Heartbeat
- RBA's comments on China market turmoil ``of most interest''
- Australia likely to need lower cash rate, currency, RBC says
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Any investors wanting to gauge the severity of the global fallout from China’s economic downturn could do worse than listen to what Australia’s central bank says Tuesday.
The Reserve Bank of Australia manages the developed world’s most exposed economy to China and until now signaled stock market volatility there wouldn’t hurt Chinese consumption. While traders and economists predict Governor Glenn Stevens will keep interest rates unchanged at a record-low 2 percent tomorrow, wagers on a cut by December jumped to 65 percent Monday, from about 35 percent before China devalued the yuan Aug. 11.