Tuesday, October 4, 2011

Dollar falls below 95 US cents briefly; recovers after Australia's trade surplus doubles expectations

The Australian dollar took another hit in late morning trade as concerns remain that Greece will ultimately default on its debt obligations.
The currency briefly slipped just below 95 US cents to a low of 94.77 US cents as investors continue to rush to the safety of the US dollar and US Treasury bonds.

The demise of the A$ has been rapid, having fallen through the 96 US cent barrier only yesterday.

However, unexpectedly strong economic data trimmed the dollar's demise, prompting a recovery to 95.38 US cents just after noon eastern daylight saving time.

According to the Australian Bureau of Statistics, building approvals for August rose by 11.4 percent when the market consensus had been for a one percent increase.

trade surplus in August created a brief bout of optimism coming in at $3.1 billion - the widest gap since June 2010.

The gain has been driven by a surge in coal experts confirming that demand from China and India continues to underpin the performance of the Australian economy.

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