The Australian dollar fell to its lowest level since January, after the US Federal Reserve indicated it would not be taking action to further stimulate the American economy.
The Aussie dollar was trading at $US1.0278, having fallen from an opening price of $1.0331 on the news.
On January 17, the Australian dollar hit a low of $US1.03. The local unit has fallen as low as $1.0287 in today’s trade.
Australia’s trade deficit has narrowed in February, against expectations of a surplus, according to data from the Australian Bureau of Statistics. According to the figures, Australia’s trade deficit for the month of February was a seasonally adjusted $480 million, an improvement of $491 million on last month. The result follows a downwardly-revised deficit of $971 million in January. Economists’ forecasts had centered on a surplus of $1.1 billion in February.
Activity in the Australian services sector contracted in March, as trading conditions weakened and the local currency stayed strong, a private survey shows. The Australian Industry Group/Commonwealth Bank Australian Performance of Services Index (PSI) rose 0.3 points to 47.0 points in March. A reading below 50 indicates a contraction in activity.
Only two of the nine sub-sectors covered by the survey recorded rises in activity. They were finance and insurance, and personal and recreational services.
.The high (Australian) dollar is thwarting the prospects for trade-exposed service businesses and a lack of confidence among households is holding back the retail sector and service businesses. (source http://www.fxempire.com )
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