Aussie dollar nudges higher in afternoon trade

The local unit has strengthened modestly, as fears around Donald Trump’s policies hurt the greenback.

Currency traders pushed the US dollar down, supporting the Australian dollar slightly. Picture: istock

The Australian dollar nudged higher in midafternoon trade on Monday, helped by a softer US dollar, with traders nervous after the latest round of major decisions being announced by the new Trump Administration.

At 3.40pm (AEDT), the Australian dollar was at US75.52 cents, compared with US75.43c late in on Friday.

The US dollar fell in Asia-Pacific trading as nervousness grew among investors, following US President Donald Trump’s order to tighten immigration rules and data overnight on Friday showing the US economy slowing at the end of 2016.

Currency traders pushed the US dollar down against the yen and the euro in trading thinned by the Lunar New Year holidays in Asia.

The US dollar slipped against the Japanese currency from a weekend high of Y115.38 to as low as Y114.27.

The Australian dollar will likely get some support later in the week with economists expecting a record trade surplus in December, thanks to rising commodity prices and soaring export volumes of iron ore and coal.

While market consensus is for a $2 billion trade surplus in December, CBA Research said it will likely be something closer to $3bn, well up from November’s $1.2bn surplus.

Dow Jones newswires