Dollar rises on US data

 

dollar, coins, moneyThe Australian dollar has risen after weak US economic figures raised hopes the US Federal Reserve might not increase the tapering of its economic stimulus program any time soon.

At 0700 AEDT on Friday, the local unit was trading at 89.87 US cents, up from 89.34 cents on Thursday.

Westpac New Zealand senior market strategist, Imre Speizer, said the data gave riskier assets such as equities and the Australian dollar a boost.

“Sentiment was perkier during the New York session, encouraged by some weak US data seen as supportive of the Fed’s stimulus programs,” he said from Auckland.

“Retail sales and jobless claims reports were disappointing and only modestly offset by an improvement in business inventories.”

US Commerce Department figures showed that retail sales fell 0.4 per cent in January, while up 4.2 per cent in the 12 months to January, the weakest annual gain in four years.

Speizer said most of the January fall in spending was blamed on terrible weather across parts of the US but the underlying trend was still worrying.

“Typically, weather disruption both boosts and hampers retailing at different times and for different store types, but the broad-based weakness stretching back three months into mild November is more likely a belatedly accurate reflection of constrained incomes growth,” he said.

Of interest to local markets on Friday will be a speech Reserve Bank of Australia assistant governor (Economic) Christopher Kent gives to the Committee for Economic Development of Australia (CEDA) Economic and Political Overview 2014 in Sydney.

AAP

You have 7 articles remaining. Unlock 15 free articles a month, it’s free.