The Australian Dollar started the week well on the back of positive Purchasing Manager’s Index data out of China. These gains were quickly erased, however, by strong data being released during Tuesday’s trading session in the US.
The biggest domestic news last week was the Reserve Bank of Australia’s rate decision, which was released on Tuesday. The RBA decided to keep the cash rate at record lows of 2.5 percent with the RBA Governor, Glenn Stevens, stating that the Aussie is still “uncomfortably high.” The lowering of the interest rate usually causes the Australian Dollar to depreciate; this, according to Stevens, is seen as necessary “to achieve balanced growth in the economy.”
The Aussie remained largely range-bound for the rest of the week as it continues to look for direction from abroad, with improved US unemployment data and positive trade balance figures from China tugging the Aussie in opposite directions.
This week, there are a series of important data sets to be released by Australia’s biggest trading partner, China. The first, the Consumer Price Index, was released yesterday and it showed an increase of 3% from the year before. However, further Chinese data offered a mixed view of the economic activity in the world’s second largest economy, and the Australian dollar slipped to 90.99 to the US Dollar late on Monday.
GBP / AUD : 1.9842
EUR / AUD : 1.6637
USD / AUD : 1.2088
AUD / NZD : 1.102
Exchange rates as of 09:37, 11 December 2013
:: Note: The above exchange rates are based on “interbank” rates.
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