An economist at St. George Bank Ltd, Mr. Janu Chan said in Sydney that the market would continue to be volatile up until after the Greece election which is expected to determine the Greece status in the euro area. Euro area concerns have kept the Australian dollar below parity and after Greece elections this might change. The Reserve Bank of Australia has cut interest by 75 percent this year in a bid to encourage growth in the country. The currency has also been boosted by the Moody’s comments that the country’s AAA status is secure and the economic strength in the country is very high. The government is struggling to deal with low consumer confidence as retail sector continues to deteriorate.
The market expects the Reserve Bank of New Zealand is expected to keep interest rate at 2.5 percent when its policy makers meet tomorrow. The New Zealand currency was little changed against the US dollar trading at 77.69 US cents after it reached 77.89 the strongest level since May 15. It gained 0.1 percent against the yen to trade at 61.87 yen.
The Australian dollar dropped by 0.1 percent against the US dollar to trade at 99.50 US cents after it had gained by the same margin earlier in the day. It was little changed against the yen trading at 79.24 yen from 79.20 yen it traded yesterday.