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Dollar levels off

dollar, piggy bank, moneyThe Australian dollar has levelled off after enjoying a strong rally on the back of retail spending figures, which showed signs of improvement.

At 0700 AEST on Thursday, the local unit was trading at 79.74 US cents, up from 79.72 cents on Wednesday.

BK Asset Management MD, Kathy Lien, said the Aussie closed one per cent higher during the local session on Wednesday.

“Traders were unfazed by softer retail sales growth as an uptick in new home sales and stronger Chinese service sector activity gave them enough reason to stay long on the Australian dollar,” she said.

However, Lien said the there is caution in the market ahead of the release of Australian jobs figures on Thursday.

“The rally could lose steam if the employment numbers come out as expected – economists are looking for job growth to slow significantly and for the unemployment rate to rise,” she said.

Official figures are expected to show the number of people with jobs rose by 10,000 in April, while the unemployment rate is forecast to rise to 6.2 per cent.

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