The Australian Dollar has strengthened against the majority of its most traded peers after comments made by the Reserve Bank of Australia caused investors to trim their bets on further interest rate cuts.
The ‘Aussie’ advanced for a second consecutive day after being aided by increasing speculation that the US Federal Reserve will hold off tapering its monetary easing programme. Fed Chairman Ben Bernanke is due to make his monthly testimony to Congress on Wednesday.
The Pound to Australian Dollar exchange Rate fell to 1.6454
The Fed Chairman said in last month’s testimony that the Central Bank could slow its $85 billion monthly bond purchases this year and end them in 2014 if economic growth meets policy maker’s targets. However, weaker-than-expected data from last week has cast doubt over any immediate slowdown.
Traders are pricing in a 54% chance that the RBA will lower borrowing costs by a quarter % point to a fresh record 2.5% low next month, down from the previous chance of 65% seen yesterday.
“There were some marginal shifts in the RBA’s language acknowledging the potential impact of the currency’s decline on its inflation outlook,” said Robert Rennie, the chief foreign-exchange strategist at Westpac Banking Corp. “There’s an argument to suggest we’ve gotten far too bearish on the Aussie. If you’re sitting short Aussie off the lows you’re probably feeling a bit nervous and that’s really why we’re seeing a bounce.” A short position is a bet a currency will decline in value.
Current Exchange Australian Dollar (AUD) Rates
The Australian Dollar/US Dollar Exchange Rate is currently in the region of: 0.9171
The Australian Dollar/Euro Exchange Rate is currently in the region of: 0.7018
The Australian Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.6077
The Australian Dollar/ New Zealand Dollar Exchange Rate is currently in the region of: 1.1717
The US Dollar/Australian Dollar Exchange Rate is currently in the region of: 1.0903
The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.4248
The Pound Sterling /Australian Dollar Exchange Rate is currently in the region of: 1.6454
The New Zealand Dollar/Australian Dollar Exchange Rate is currently in the region of: 0.8534
Correct as of 10:25 am GMT
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