Australian Dollar Posts Weekly Gains, Reverses Downtrend
The Australian dollar had a nice rally this week as positive domestic fundamentals added to improving market sentiment that pushed currencies related to growth higher. That was a refreshing sight after a long stretch of declines.
The Aussie was rallying for the most part of the week, demonstrating a particularly strong performance on Wednesday. That is a pleasant turn of event, considering that the currency has entered a downtrend in the beginning of March. It is too early to consider that the Australian dollar has entered uptrend, but it looks like the one-way downside move has ended. Many Forex analysts think that too many negative events were priced in and the currency is ready to move even higher, especially if market sentiment continue to improve.
The beginning of this week looked not very good for the Aussie as investors’ mood was not particularly good. Yet the Australian currency managed to move up in that unfriendly environment, even after the Reserve Bank of Australia cut interest rates for the second time in a row. The positive GDP report provided a major boost and was followed by the good employment data and the unexpectedly small trade balance deficit. Overseas, thing were also supportive for the Aussie as China decreased its interest rates and rumors that Spain might get an aid lifted up Forex traders’ mood.
AUD/USD advanced from 0.9699 to 0.9913, reaching 1.0002 on Thursday — the highest price since May 15. EUR/AUD declined from 1.2797 to 1.2617. AUD/CAD climbed from 1.0073 to 1.0180 this week and its weekly maximum was at 1.0248, the highest level since May 1.
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Earlier News About the Australian Dollar:
- Aussie Erases Losses as Market Sentiment Turns to Optimism (2012-06-08)
- Aussie Heads Higher on China Rate Cut (2012-06-07)
- Aussie Gains with Unexpectedly Growing Employment (2012-06-07)
- Aussie Climbs for Third Session as GDP Growth Beats Forecasts (2012-06-06)
- Aussie Rate Cut Affects Performance Only Slightly (2012-06-05)