Australian Dollar Higher Despite Cautious Market

Australian Dollar Higher Despite Cautious Market

The Australian dollar has moved to within half a US cent of parity with its US counterpart and could move higher in the coming days, even as markets remain nervous about upcoming Greek elections. Steven Dooley, from ForexCT said it had been a quiet day of trading, with Reserve Bank of Australia Governor Glenn Stevens' speech to the federal government's economic forum failing to generate the expected bounce in the currency. He said that, while the market was cautious in the lead up to the Greek elections on June 17, the Australian dollar could move as high as 102 US cents by the end of the week."Certainly everything the charts are telling us at the moment, despite all the bad news, is that the Aussie dollar and gold want to go higher," he said.

Elsewhere today according to the Westpac/Melbourne Institute Consumer Sentiment Index, has suggested that Australian consumer confidence is shaky despite interest rate cuts. The survey showed a rise of only 0.3% to 95.6 points in June. Across the five sub-indexes of consumer sentiment, two improved and three deteriorated. Lower interest rates contributed to a strong rise in the family finances index as it was up 4.6% compared to a year ago, following a 17% gain in May. Willingness to spend on a major household item was also up 7.5% and positive responses to questions about whether it was time to buy property or a car rose 8.2% and 7.5%. Having said this, consumers’ views about the prospects for their family finances slumped by 7.7%, and their view of the economic outlook over the next five years fell by 3.8%.