Dollar slides


coins,dollar,money,silver,goldThe Australian dollar is slightly lower as traders take profits after the currency’s three-week rally.

At 0700 AEDT on Friday, the local unit was trading at 96.17 US cents, down from 96.66 cents on Thursday.

The Australian dollar has risen at least three US cents since the beginning of the month, hitting a series of five-month highs earlier in the week.

OM Financial senior client adviser Stuart Ive said a lot of the larger managed funds were selling the currency because they don’t think it would rise much further.

“We’re heading into November, not far from the Christmas break, so a lot of the big players would be booking profits,” he said from Wellington.

“The volumes are looking a little bit thin out there at the moment.

“It’s a very confusing picture at the moment because you have a lot of things going on.

“Most central banks have been ruling out the chance of a further interest rate cut, but they’re also pushing out the chances of a rate rise out further and further.”

Ive said there also was a bit of nervousness that US politicians would go through another round of brinkmanship when it has to get its budget passed in January.

The US government was shut down for the first two weeks of October after the Congress failed to agree to a budget by the end of the financial year.

The US government now has enough funds to operate until early next year.

On Friday night, Australian time, the US will release durable goods data for September, which covers sales of household goods like fridges and washing machines.

Ive expects the Australian dollar to trade in a range between 95.60 and 96.70 cents on Friday.


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