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Dollar continues upward

money, trading, dollarThe Australian dollar has surged past the US 80 cent mark on the back of weak US economic data and concerns about the Federal Reserve meeting.

At 0700 AEST on Wednesday, the local currency was trading at 80.22 US cents, up from 78.73 cents on Tuesday.

BK Asset Management MD, Kathy Lien, said a number of factors had driven the local currency higher, including weaker than expected US economic data.

Data out overnight showed that US consumer confidence dived from 101.4 to 95.2 in April, its weakest reading so far in 2015.

“It came in much weaker than anticipated,” Lien said.

She said another contributor was ongoing concern about this week’s US central bank meeting.

“They (investors) fear the Fed is going to downgrade the assessment of the economy and, basically, rule out new rate hikes,” Lien said.

She said reluctance by Reserve Bank of Australia governor, Glenn Stevens, to discuss monetary on Tuesday was another factor helping the Aussie.

“Investors interpreted Stevens’ stance as a sign that the central bank will officially draw their easing cycle to a close in May.”

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