The Australian dollar has been ranking among the top 5 best performing currencies since the global economy started to give signs of recovering, and speculations regarding interest rate hikes provided support for the Aussie to gain versus all six main traded currencies this Tuesday.
Speculations regarding an eventual interest rate hike in Australia provided support for the Aussie to climb for a third day in a row, setting the South Pacific currency to the highest rate in 13 months versus most of its main rivals, as odds that the Reserve Bank of Australia will increase its benchmark interest rates grow by the day, improving the national currency appeal among investors. The Australian dollar is benefiting also from an increased wave of optimism in the South Pacific region, as New Zealand has also been recovering from the crisis faster than other wealthy nations, improving the sentiment for its nation’s currency and also favoring the Australia in a broader scenario.
Australia is expected to be the first country to raise interest rates, if confirmed, this fact will cause the Aussie to rally even further, mainly versus majors and other currencies that are also expecting rate hikes. It is very likely that the Australian dollar will find support to remain high in the short-term as this scenario has a tendency to continue towards the end of the year.
AUD/USD traded at 0.8728 as of 11:27 GMT from 0.8662 yesterday. AUD/JPY traded at 78.42 from 77.47.
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