Dollar slumps on euro weakness

THE Australian dollar has fallen more than half a cent against its US counterpart with the greenback strengthening amid euro weakness.

THE Australian dollar has fallen more than half a cent against its US counterpart with the greenback strengthening amid euro weakness following the release of European Central Bank’s policy meeting minutes.

At 0635 AEST on Friday, the Australian dollar was worth 78.86 US cents, down from 79.47 US cents on Thursday.

The ECB minutes showed officials warning about a possible market overshoot for the euro which subsequently sank to a three-week low, boosting the US dollar. The greenback whipsawed for much of Thursday after rumours surfaced about the possible resignation of US National Economic Council director Gary Cohn who, with Treasury Secretary Steve Mnuchin, is seen as pivotal to President Donald Trump’s economic agenda of tax cuts and infrastructure spending. Westpac’s Imre Speizer said the US dollar index, which measures the greenback against a basket of six major currencies, lifted 0.1 per cent on Thursday, while the Australian dollar fell from 79.63 to 79.01 in the offshore session. He didn’t expect the Aussie to redeem itself on Friday, but to “lower to 0.7880 if global sentiment remains risk averse”.

The local currency is also down against the yen and the euro.

CURRENCY SNAPSHOT AT 0635 AEST ON FRIDAY

One Australian dollar buys:

* 78.86 US cents, from 79.47 on Thursday

* 86.40 Japanese yen, from 87.39 yen

* 67.28 euro cents, from 67.55 euro cents

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

Originally published as Dollar slumps on euro weakness