Dollar Report – Australian Dollar on a rollercoaster ride

The Aussie strengthened to the US on Friday, moving from 95.56 US cents on Thursday to 97.75. This was after an announcement by the US government that its payrolls increased by more than expected, as well as news of some relief for the current euro zone crisis.

The easing of pressure in the euro zone was a result of the hold on interest rates inEurope, as well as a statement by Jean-Claude Trichet, President of the European Central Bank, that the bank would continue to assist lenders to prevent a possible credit crunch.

The release of the US non-farm payrolls data showed that 103 000 jobs had been added in September, which was better than market forecasts.

Imre Speizer, a strategist at Wetspac Banking Corporation inAucklandsaid even though the euro zone will continue to dominate sentiment, the payroll number took some of the negativity away from the US economic outlook.

Mr Speizer’s comments about the euro zone were indeed true, as Australian Dollar dropped again to 97.34 US cents by the end of the weekend. This was after the Fitch agency downgraded its sovereign credit rating for Italy and Spain. This is as result of the poor outlook for both countries, as both have high debt and poor prospects for growth.

Experts believe that despite the current situation in the markets, the Aussie should overtake the US dollar by year end.

GBP/AUD:      1.5856
EUR/AUD:     1.3686
AUD/USD:     0.9836
AUD/JPY:       75.41
Exchange Rates at 08:55, 10 October 2011

Composed by Francois de Wet
::Note: The above exchange rates are based on “interbank” rates. If you want to transfer money to or fromAustraliathen please register/login on our website, www.1stcontactforex.com, or call us for a live dealing rate. Make use of a Rate Notifier to send you alert when the Australian exchange rate reaches levels you are looking for.