The Australian dollar is trading slightly higher after today’s RBA minutes meeting where the bank reiterated they would like to see a period of stability in Interest rates pushing aside speculation of a rate cut next year.
At 4.50pm (AEDT) the local currency is trading at US 82.26 after falling to a fresh four and a half year low of US81.99 cents earlier today and up from US82.12 cents yesterday.
A 16 hour siege in Sydney ended yesterday with three people dead including the hostage taker which undermined the Aussie dollar as well as a further fall in oil prices.
Westpac senior market strategist Imre Speizer noted that these two events pressured the Aussie dollar pushing it to lt’s lowest level since July 2010,
“Oil failed to hold on to overnight gains with Brent crude slipping back to Friday’s lows of $US56.50. Equities continue to move in tandem with oil initially opening higher before giving up the gains later in the day,” he said.
More worrying signs emerged for the Chinese economy today as the HSBC flash PMI for China was released to the market coming in slightly under analyst’s expectations. The latest number came in at 49.5 against a consensus of 50 with a number generally under 50 seen as a contraction.
The Australian dollar is expected to come under further pressure as we head into Wednesday’s Interest rate decision and monetary statement from the Federal Reserve. There is more evidence mounting that the Fed needs to move on rates and with this expectation it doesn’t hold well for the Australian dollar claim analysts at Fibogroup forex brokers.
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