Dollar higher on RBA's rosy outlook

THE dollar was firmer after the central bank gave a rosy picture of the economy.

THE dollar was firmer after the central bank gave a rosy picture of the economy.

At 5pm (AEDT), the local unit was trading at 101.84 US cents, up from 101.00 cents on yesterday.

Since 7am (AEDT), the local dollar traded between 101.41 US cents and 101.93 cents.

CMC Markets currency strategist Tim Waterer said the unit rose after the release of the Reserve Bank of Australia's (RBA) quarterly monetary policy statement.

"It was another good day for the Aussie," he said.

"They have a relatively rosy outlook for the Australian growth outlook, so the Aussie gained about 35 pips (one third of a US cent)."

The RBA said the economy was expected to grow at an above-average pace of 3.75 to 4.0 per cent to June 2013.

The bank said flooding in Queensland would not have any lasting effect on the economy.

The local unit opened the local session firmer following a raft of US data last night (AEDT) including a larger than expected fall in jobless claims and activity in manufacturing and service companies reaching a level not seen since 2008.

At 5pm (AEDT), the dollar was at 81.61 Japanese yen down from yesterday's close at 82.44, and at 74.69 euro cents, up from its previous close of 73.20.