The ASX 200 (Index: ^AXJO) (ASX: XJO) was eventful again this week. Here are four big stories you may have missed that affected the ASX 200 index:
APRA Ends 7% interest rate buffer
The Australian Prudential Regulation Authority (APRA) decided to end its 7% interest rate buffer lending limit for banks this week. This was part of the reason why share prices of banks like Commonwealth Bank of Australia (ASX: CBA) and Westpac Banking Corp (ASX: WBC) rose.
The new rate will buffer will be the current interest rate for the loan, plus an additional 2.5%, which I think is more relevant in this era of very low interest rates.
RBA cuts rates
The Reserve Bank of Australia (RBA) decided to cut interest rates by another 0.25% to send Australia's interest rate to a record low of just 1%.
Investors believe this may benefit banks such as National Australia Bank Ltd (ASX: NAB) and Australia and New Zealand Banking Group (ASX: ANZ) as well as the somewhat cyclical businesses like retailers and property construction businesses.
Trade war to end?
On the sidelines of the G20 summit in Japan, United States President Donald Trump and Chinese leader Xi Jinping spoke at length and have agreed to restart trade talks with additional tariffs being put on hold for the time being.
The positivity for a trade agreement between the US and China could be one of the reasons why the A2 Milk Company Ltd (ASX: A2M) share price ended the week higher than it started.
Woolworths Group Ltd (ASX: WOW)
The supermarket giant is thinking about merging its drinks and hotels businesses together, which includes BWS and Dan Murphy's.
After the merging is complete, Woolworths plans to divest the combined business sometime in 2020. This is yet another example of the company shrinking to try to improve its operations.
