The Australian 13/5/2013 – Derek Mumford

$A stuck around parity

THE Australian dollar is stuck around the 100 US cent mark as expectations grow that stimulus efforts in the world’s largest economy will be wound back.

At 1700 AEST on Monday, the currency was trading at 100.00 US cents, down from 100.63 US cents on Friday.

The currency fell below parity with the US dollar for the first time in 11 months over the weekend after a Wall Street Journal article suggested the US Federal Reserve would wind back its quantitative easing program.

“That has certainly helped to strengthen the US dollar and the Aussie has been hit particularly hard by that,” Rochford Capital senior consultant Derek Mumford said.

Mr Mumford said the Australian dollar remained below the 100 US cent mark during most of Monday’s local session.

He said news of a 5.2 per cent jump in home loans in March, a better than expected result, had been largely ignored by the market which was more focused on the global economy and signs of an improvement in the US.

“I think it’s really the bigger picture that is moving the market.”

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