Australian dollar recovers on highest figure in 20 years

The Australian dollar has recovered in today’s trading after yesterday’s sell off on the back of strong local date which hit the market at its highest level in over 20 years.

At 3.16pm(AEDT) the Aussie dollar was trading at US76.32c after threatening to hit the US75c mark earlier in the trading session and up from US76.12 in yesterday’s trade.

The latest National Australia Business conditions survey from Australia released to the market earlier today came in at 21, well up from last month’s figure of 14 and justifies comments made by RBA governor Philip Lowe last week who gave an overall upbeat assessment of the economy.

Mr Lowe noted that although inflation was still below the central bank’s target rate and was expected to remain there for some time, overall the economy was moving forward and in general the business climate was looking healthy

“Results from the survey indicate that the business sector in Australia is very strong at present, which is having positive spill-overs into the labor market and, to some extent, investment,” Noted analysts from NAB

The Business survey offset disappointing data released from Australia’s biggest trading partner China with industrial production figures coming in at 6.2 percent while retails sales numbers hit the market at 10 percent which were both below expectations.

The fall in industrial production is attributed to the tightening of pollution laws which has seen many firms cut back on production as they scramble to come to terms with the new regulations by directing capital to upgrade machinery.