Australian dollar dips as global growth fears resurge

THE Australian dollar has dipped lower after weak data out of the US, UK and Europe reignited concerns about global economic growth.

Australian money - coins, cash generic. Stacks of one dollar coins, with twenty dollar note behind.

THE Australian dollar has dipped lower after weak data out of the US, UK and Europe reignited concerns about global economic growth.

At 0700 AEDT on Wednesday, the local currency was trading at 87.08 US cents, down from 87.85 cents on Tuesday.

“(There was) further concern for the global economy overnight, after poor data in Germany, Europe, the UK and the US,” National Australia Bank senior economist Spiros Papadopoulos said.

Soft UK inflation figures, disappointing small business figures from the US and a worrying sentiment survey out of Germany sparked the concerns.

“The German economy is losing traction very quickly and there is a real prospect that it could contract again in the third quarter,” Mr Papadopoulos said.

Meanwhile, a local NAB business survey on Tuesday was also disappointing, showing a dip in business confidence and conditions in September.

“The survey suggests the economy continues to run at a sub-trend pace and that unemployment will rise further, keeping the Reserve Bank (interest rate) on hold for a long time,” Mr Papadopoulos said.

Currency snapshot at 0700 AEDT on Wednesday

One Australian dollar buys:

* 87.08 US cents, from 87.85 cents on Tuesday

* 93.18 Japanese yen, from 94.16 yen

* 68.81 euro cents, from 69.11 euro cents

* 111.14 New Zealand cents, from 111.33 NZ cents

* 54.74 British pence, from 54.68 pence

One euro buys:

* 126.56 US cents, from 127.13 cents

* 135.43 Japanese yen, from 136.25 yen

One US dollar buys:

* 107.01 Japanese yen, from 107.18 yen

(*Closes taken at 1700 AEDT previous local session)

Source: IRESS

Originally published as Australian dollar dips as global growth fears resurge