Aussie Pulls Back on Chinese Comments

  July 16th, 2012 at 14:25, Miranda Marquit

Reverend John Flynn on Australian 20-dollar billAustralian dollar is heading lower against the US dollar today, due in large parts to comments made by Chinese Premier Wen Jiabao. Additionally, general risk aversion is setting in as concerns about the eurozone and US earnings news look to be lackluster.

Aussie has lost ground today, after making a strong performance earlier. Aussie is down against the dollar as concerns about what’s next for the global economy weigh on a number of risk currencies. Chinese Premier Wen Jiabao made comments about the slowing Chinese economy over the weekend, and that is having an effect today. China’s economy is linked to Australia’s, since they are major trading partners, and a slowing Chinese economy doesn’t bode well for the Aussie. General risk aversion is also coming from lackluster US earnings news.

Also not helping matters is a bit of concern about gold prices. Gold remains below the psychologically important $1,600 an ounce level, and doesn’t look to be strengthening, especially with the pressure on it from a falling EUR/USD. Aussie is a commodity currency connected to gold, and weaker gold prices affect the Down Under currency. Aussie is higher against the euro, though.

At 14:22 GMT AUD/USD is down to 1.0216 from the open at 1.0233. EUR/AUD is down to 1.1957 from the open at 1.1962. GBP/AUD is up to 1.5256 from the open at 1.5218.

If you have any questions, comments or opinions regarding the Australian Dollar, feel free to post them using the commentary form below.

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