The Australian Dollar climbed to its highest level in a week against the Pound and US Dollar as investors scaled back their expectations that the nation’s Central Bank will make an interest rate cut before the end of the year.
The reduction in the odds of a cut bolstered demand for the Australian currency sending it up to five-day gains against the majority of its most traded peers. The currency has received support in recent days as economic data releases out of China, Australia’s biggest trading partner, were positive. Next week’s service industries data out of the Asian nation is expected to lend further support to the ‘Aussie’.
RBC Capital markets currency strategist Sue Trinh said the chances of a rate cut by the Reserve Bank before the end of 2013 were weakening.
“The Australian Dollar has been resilient in the face of softer stocks, rallying in Asia off its lows and to a new high for the week as expectations of RBA rate cuts get pushed back,” Ms Trinh said.
Both Westpac and National Australia Bank Ltd. pushed back the dates when they expect a rate cut to occur with the former pushing a rate cut to May whilst the latter pushed back their forecast to February next year.
“We’ve shifted up our year-end forecast for the Australian Dollar. Australian households are showing less signs of risk aversion. We’ve seen signs of stabilization and improvement in China” said Robert Rennie, chief currency strategist at Westpac Banking Corp.
Australia’s biggest lender the Commonwealth Bank of Australia also raised its forecast for the Australian currency. It now predicts that the Aussie will reach 94 cents to the US Dollar by the end of the year.
Current Exchange Australian Dollar (AUD) Rates
< Lower > Higher
The Australian Dollar/US Dollar Exchange Rate is currently in the region of: 0.9433 >
The Australian Dollar/Euro Exchange Rate is currently in the region of: 0.6930 >
The Australian Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.5856 >
The Australian Dollar/ New Zealand Dollar Exchange Rate is currently in the region of: 1.1365 >
The US Dollar/Australian Dollar Exchange Rate is currently in the region of: 1.0601 <
The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.4430 <
The Pound Sterling /Australian Dollar Exchange Rate is currently in the region of: 1.7075 <
The New Zealand Dollar/Australian Dollar Exchange Rate is currently in the region of: 0.8798<
Correct as of 11:40 am GMT
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