Dollar hits one-week low

THE Australian dollar has fallen to its lowest level in more than a week following the release of disappointing building approvals figures.

THE Australian dollar has fallen to its lowest level in more than a week following the release of disappointing building approvals figures.

The currency dropped to 102.40 US cents shortly before noon (AEST), its lowest level since April 24, following news Australian building approvals fell to a seven-month low in March. Figures released by the Australian Bureau of Statistics today show approvals for the construction of new homes fell 5.5 per cent across Australia in March.

"That was definitely a soft number," Commonwealth Bank currency strategist Joseph Capurso said.

At 12pm AEST today, the currency was trading at 102.78 US cents, down from 103.54 US cents yesterday afternoon.

The currency weakened overnight yesterday following disappointing US economic figures and falls on share markets. But, Mr Capurso said, the Australian dollar was likely to recover during this afternoon.

"I think the rally overnight was a bit of an over-reaction," he said. "So, I think the Aussie dollar is going to find a base and then grind back towards 103 US cents over the next 24-48 hours."

Meanwhile, Australian bond futures prices were stronger at noon. At 12pm AEST today, the June 10-year bond futures contract was trading at 96.985 (implying a yield of 3.015 per cent), up from 96.900 (3.100 per cent) yesterday. The June three-year bond futures contract was at 97.510 (2.490 per cent), up from 97.430 (2.570 per cent).