The Aussie Dollar weakens on International Strain

GLOBAL uncertainty continues to drive markets as the EU’s focus moves to Spain this week. The Aussie traded at 1.6108 GBP/AUD on Friday up from the 1.6073 AUD on Monday.

Catalonia, an autonomous region in the north-east of Spain, has requested help from the Spanish Central Government in financing their payments at the end of the month.  ‘Your economy can’t recover if you can’t pay your bills.’ stated Catalan President, Artur Mas on Friday.  Catalonia has the daunting task of refinancing 13 billion Euros on top of its expected fiscal deficit this year.

Chinese data released on Thursday supported the growing concern around the economic slowdown in the world’s second largest economy. The HSBC PMI fell to 48.7 in May on the back of weaker exports. This negative economic data supports the strong calls for monetary easing in China which will see the effects filter down into the Australian Economic Climate.

The US markets will be closed on Monday as they celebrate Memorial Day.

Looking to the rest of the week we will see a number of local indicators being released. These include the retail sales and building approvals. The market will also speculate about next week’s Australian Monetary Policy meeting where the overnight cash rate will be discussed and set.

GBP / AUD: 1.6039
EUR / AUD : 1.2820
USD / AUD : 1.0242
NZD/ AUD : 0.7719

Exchange rates as of 08:22, 28 May 2012

Composed by Elizabeth Britz
:: Note: The above exchange rates are based on “interbank” rates.
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