Australian shares closed higher on Tuesday as the central bank raised its economic growth forecast and kept interest rates on hold, with commodity-related stocks leading the way on the benchmark index.
The S&P/ASX 200 index rose 0.6% to 7,067.90, closing higher for the second straight session. Broader Asian markets also edged higher, helped by signs of recovery from the pandemic in major economies.
The Reserve Bank of Australia (RBA) left its key rates at near zero for a fifth straight meeting and upgraded the 2021 economic growth forecast to 4.75% from 3.5% in February.
Having unleashed the biggest monetary stimulus ever, policymakers aren't going to let up this time, CommSec analysts wrote in a note.
RBA Governor Philip Lowe appears willing to do whatever it takes to get unemployment closer to 4% and annual wage growth near 3% to see inflation sitting securely within the bank's 2%-3% target, they added.