Australian dollar falls sharply

THE Australian dollar is fallen sharply against its US counterpart which has lifted on strong US data.

THE Australian dollar is fallen sharply against its US counterpart which has lifted on strong US data. At 0635 AEST on Wednesday, the Australian dollar was worth 78.20 US cents, down from 78.47 US cents on Tuesday.

Westpac’s Imre Speizer said stronger-than-expected US retail sales data had lifted US interest rates and bond yields, sending the Australian dollar — and its New Zealand peer — lower.

“US retail sales rose 0.6 per cent in July, against an expected 0.3 per cent, with the various core measures also exceeding expectations,” Me Speizer said in a morning note.

“Together with upward revisions to the previous two months, the report supports the view that the consumer sector is in good health, helped by a buoyant jobs market.

“The US dollar index is up 0.4 per cent on the day, making a two-week high (and the) AUD extended a two-week slide from 0.7840 to 0.7808.” Meanwhile, iron ore fell 1.4 per cent on Tuesday, which also weighed on the local currency.

“The AUD has retraced 50 per cent of the June/July rally, and should extend below 0.7800 if the US dollar extends its gains,” Mr Speizer said. The local currency has also fallen against the yen and the euro.

CURRENCY SNAPSHOT AT 0635 AEST ON WEDNESDAY

One Australian dollar buys:

* 78.20 US cents, from 78.47 on Tuesday

* 86.51 Japanese yen, from 86.57 yen

* 66.64 euro cents, from 66.82 euro cents

(*Currency closes taken at 1700 AEST previous local session)

Originally published as Australian dollar falls sharply