Monthly Archives: April 2013

Dollar softer as US data bolsters greenback

HE Australian dollar is lower against the greenback, which made broadbased gains on the back of US data. At 0700 AEDT on Monday, the local unit was trading at 71.36 US cents, down from 72.20 cents on Friday.
Westpac economists said US data including — including gross domestic product, inflation and consumer spending — added fuel to a recovering greenback on Friday night.
The US economy grew at an annual rate of one per cent in the fourth quarter, beating analysts’ forecasts.
“However, we’re taking this surprise with a grain of salt,” the economists said.
“Much of the revision reflected a larger-than-expected inventory gain, which could reverse over the coming months.” There was also a larger-than-expected lift in US inflation, while consumer spending had the largest monthly gain in 10 months. A busy week for the local data calendar starts with fourth quarter company profits and inventories, January private credit figures and an inflation gauge for February.
BK Asset Management managing director Kathy Lien said Australian and Chinese manufacturing reports were due for release on Tuesday, along with the Reserve Bank of Australia monetary policy meeting. And, with local GDP and retail sales figures and US non-farm payrolls also due this week, there’s no shortage of event risks capable of triggering big moves in currencies.“The recent recovery in US and European equities could evaporate if Chinese manufacturing activity slows,” Ms Lien said.
“By the same token, new highs could be seen if the data shows stabilisation in the economy.” Ms Lien said the manufacturing numbers will help shape expectations for the RBA’s interest rate decision.