Dollar higher on upbeat retail sales data

THE Australian dollar was higher at noon, buoyed by the release of better-than-expected local retail trade data.

THE Australian dollar was higher at noon, buoyed by the release of better-than-expected local retail trade data.

At 1200 AEST today, the Australian dollar was trading at 107.15 US cents, up from 106.86 US cents yesterday.

Since 0700 AEST today, the local unit traded between 106.61 US cents and 107.23 cents.

Commonwealth Bank chief currency strategist Richard Grace said the local unit had benefited from the release of upbeat retail sales figures, and solid capital expenditure data.

Retail spending rose 0.5 per cent in July, according to official figures.

Economists' forecasts had centred on a 0.3 per cent rise in retail sales in the month.

New private capital expenditure rose 4.9 per cent in real terms, seasonally adjusted, in the June quarter, beating market expectations of a four per cent jump.

"The Aussie had a bit of bounce after those stronger-than-expected retail trade and capital expenditure numbers," Mr Grace said.

"It puts to rest some of the concerns about the health of the local economy on the retail side."

Meanwhile, the Australian bond market was weaker at noon.

The September 10-year bond futures contract was trading at 95.535 (implying a yield of 4.465 per cent), down from 95.620 (implying a yield of 4.380 per cent) yesterday.

The September three-year bond futures contract was at 96.060 (3.940 per cent), down from 96.180 (3.820 per cent).