THE Australian Dollar dropped to a three week low early last week after the Reserve Bank of Australia announced a cash interest rate cut of a quarter of a percentage point to 3.25 per cent, in direct response to a worsening global economic outlook.
The Aussie continued to slide during the week, reaching a four week low on Wednesday after Australia recorded its widest trade deficit since 2008 and data showed China’s non-manufacturing industries grew at the weakest pace since at least March 2011.
Thursday and Friday saw the Aussie claw back some ground against the US Dollar as risk appetite grew following European Central Bank President Mario Draghi announcing the bank is ready to buy bonds to curb Europe’s debt crisis. The Australian currency closed the week at 1.026 US Dollars.
This week will be another trying time for the Aussie with the possibility that a report due for release will show an increase in unemployment. This would fuel speculation that the RBA may further reduce its key rate next month, adding downward pressure to the Australian Dollar.
AUS/ GBP: 0.6340
AUS/ EURO: 0.7882
AUS/ USD: 1.0269
AUS/ JPY: 80.458
Exchange rates as of 9:30am, 8 October 2012
Composed by Trevor Brewer of 1st Contact
Note: The above exchange rates are based on “interbank” rates. If you want to transfer money to or from Australia then please register/login on our website, www.1stcontactforex.com, or call us on 0808 141 2335 for a live dealing rate. Make use of our Rate Notifier to send you alert when the Australian Dollar exchange rate reaches levels you are looking for.