RBA skips on rate cut; focus shifts to May

Sydney

AUSTRALIA'S central bank kept interest rates steady for a second month on Tuesday to defy market pressure for a cut, but the stars are better aligned for a move in May.

The Reserve Bank of Australia's (RBA) decision to hold at 2.25 per cent surprised many investors who had wagered plunging prices for iron ore, the country's biggest single export earner, would force its hand. The local dollar shot up three quarters of a US cent to US$0.7900 as a consequence.