Forex News

The Australian dollar is profiting from speculations that a new series of interest rate hikes is likely to follow in the South Pacific nation, as its economy continues to improve, allowing the currency to gain versus its main rivals on foreign-exchange markets.

Even if China’s new domestic economic policies have been impacting markets negatively since the the beginning of the year, the Australian dollar managed to climb slightly versus important currencies today as analysts affirm that the Asian economy will continue to grow despite new restrictions imposed by Chinese central bankers.

The Australian government brought risk appetite high in the beginning of this Thursday trading session after an employment report published in the country showed better than expected figures, attracting investors to purchase assets in the South Pacific region.

The appeal for the U.S. currency surged today after an employment report showed another consecutive improvement suggesting that economic conditions are better in North America than in other wealthy regions around the world.

Despite risk appetite fueling demand for commodities produced in Australia, the Aussie dollar declined after a central bank decision published today showed no rate hikes expected by traders as the country’s economy rebounds.

The U.S. dollar lost versus most of the main traded currencies in foreign-exchange markets with a stronger risk appetite today as traders expect the economic recovery to accelerate, decreasing demand for refuge currencies after the dollar gained during most of the past week’s sessions.

The Australian dollar managed to gain versus lower-yielding currencies before a report to be released this week in the country is likely to show an advance in inflation in the last year’s last quarter, helping speculations that a series of interest rates in the country will restart.

Once again interest rates are fueling a rally for the Aussie dollar as it happened in the second half of the last year, when the South Pacific currency ranked among the best performing options in foreign-exchange markets.

The Australian dollar fell sharply versus lower-yielding currencies today as a real estate report declined optimism regarding the South Pacific economy, in a day were commodities and equities markets which have a strong correlation with the Aussie, declined.

A report published today indicating fewer-than-expected new jobless claims applications last week allowed the dollar to gain versus the euro and several other currencies as improving employment data is a key-evidence indicating the U.S. economic recovery expected for 2010.