Dollar higher despite losing ground on retail

THE dollar was trading higher at noon, despite losing ground on the release of weaker than expected retail trade figures.

THE dollar was trading higher at noon, despite losing ground on the release of weaker than expected retail trade figures.

At midday A(EDT), the dollar was trading at US96.45c, up from yesterday's close of US95.95c.

Since 7am today, the local unit traded in a range between US96.20c and US96.65c.

CMC Markets foreign exchange dealer Tim Waterer said the local currency fell four tenths of a US cent after the release of the softer than expected retail sales figures for October.

"Certainly, there's been a downturn in terms of local economic data," Mr Waterer said.

"That's taken the wind out of the sails of the Aussie dollar."

Australian retail trade at current prices fell 1.1 per cent in October to a seasonally adjusted $20.233 billion, from a downwardly revised $20.453 billion in September, the Australian Bureau of Statistics (ABS) said today.

The median market forecast was for retail sales to have risen by 0.4 per cent in the month.

It came after the local currency opened three quarters of a cent higher today as traders moved back into riskier assets due to stronger US jobs growth and signs of manufacturing expansion in China.

Mr Waterer said that, despite firm equities and a strong gold price, the local unit would remain under pressure in afternoon trade.

"The Aussie is being weighed by those macro factors, including this softer series of data that we're seeing," he said.

Meanwhile, the bonds market was weaker at noon.

At midday on the ASX 24, the December 10-year bond futures contract was at 94.555 (implying a yield of 5.445 per cent), down from yesterday's close of 94.625 (5.375 per cent).

The December three-year bond futures contract was at 95.030 (4.970 per cent), unchanged from yesterday's close.