Dollar declines


piggy bank, coins, money, dollarThe Australian dollar has again threatened to fall below 82 US cents, under pressure from low oil prices and a siege in central Sydney.

At 0700 AEDT on Tuesday, the local unit was trading at 82.22 US cents, down from 82.49 cents on Monday.

Oil prices rebounded slightly on Monday from fresh five year lows amid stubborn worries over weak global crude demand, boosting stock markets.

Meanwhile, a 16 hour siege in a cafe in the centre of Sydney ended with three people dead, including the hostage taker.

Westpac senior market strategist, Imre Speizer, said these two factors pushed the Australian dollar to new four and a half year lows.

“Oil failed to hold on to overnight gains with Brent crude slipping back to Friday’s lows of $US56.50. Equities continue to move in tandem with oil initially opening higher before giving up the gains later in the day,” he said.

“The Australian dollar declined as the siege in Sydney continued and we saw a low of 82.02 US cents before a resolution of the situation.”

Of interest to local markets on Tuesday will be the release of the minutes Reserve Bank’s December board meeting.


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