Greenback rebounds off three-year low

THE Australian dollar is slightly lower against its US counterpart which has rebounded off three-year lows.

THE Australian dollar is slightly lower against its US counterpart which has rebounded off three-year lows. At 0635 AEDT on Tuesday, the Australian dollar was worth 79.12 US cents, down from 79.17 US cents on Monday.

The US dollar enjoyed a small rebound in the offshore session as investors bought back into the currency after its plunge to three-year lows. But, analysts say any recovery will likely be brief.

The US dollar index, which measures the greenback against a basket of currencies, rose 0.3 per cent to 89.342. Westpac’s Imre Speizer says the move extended Friday’s rebound off a fresh three-year low.

“(Meanwhile), the AUD eked a narrow sideways range between 0.7900 and 0.7930,” he said in a morning note.

Reserve Bank of Australia assistant governor (Financial System) Bullock’s speech at the Responsible Lending and Borrowing Summit, in the morning, would be the main domestic event risk for the local currency, Mr Speizer said. Also, RBA minutes are expected to be released, he added.

“Given that February is a SoMP (Statement on Monetary Policy) month, the minutes are unlikely to add too much detail but may provide some colour on uncertainties around their growth outlook.”

He expects the local currency will “remain capped at 0.7990 today, given a modestly firmer US dollar”. The Aussie dollar is also a little lower against the yen and the euro.

Originally published as Greenback rebounds off three-year low