Australian dollar stronger amid eurozone concerns

THE Australian dollar is treading water above 81 US cents, amid concerns over the euro zone and lower oil prices.

Australian One Dollar Coins over Black

THE Australian dollar is treading water above 81 US cents, amid concerns over the euro zone and lower oil prices.

At 0700 AEDT on Friday, the local currency was trading at 81.10 US cents, down slightly from 81.12 cents on Thursday.

The Australian dollar shot up above the 81 US cent level on Thursday following the release of surprisingly strong figures showing approvals for the construction of new homes had risen 7.5 per cent in November.

BK Asset Management managing director Boris Schlossberg said the currency was also being supported by lower oil prices while concerns over the eurozone were driving investors towards the Aussie dollar.

The euro was in rapid decline as investors seeking better returns favoured the Aussie and kiwi currencies, he said.

“One of the side benefits of lower (oil) prices may be a better than expected growth out of China which in turn could help boost Australia’s fortunes this year,” Mr Schlossberg said.

“Little wonder then that the euro/Australian dollar trade is attracting carry flows as investors seek to benefit from it relative strength.” Coming up on Friday, investors will keep an eye on local retail sales figures at 1130 AEDT, followed by Chinese inflation data and the all-important US non-farm payrolls employment report.

Originally published as Australian dollar stronger amid eurozone concerns