The Australian dollar fell today, after reaching the highest level in two years against the US dollar, as the report showed that the new home approvals declined in August, causing the speculation that the central bank wouldn’t raise the interest rates next week.
The Australian Bureau of Statistics reported today that the number of the new building approvals dropped 4.7 percent in August, compared with 0.1 percent increase in the month before. The experts expected no change. It’ll take some time to determine where Australia’s economy are heading, but the economists say that Australia’s currency is doing very well and there is not much downward momentum.
The swaps dropped to 52 percent the chance that the Reserve Bank of Australia will increase its borrowing costs at the next meeting of its policy makers on October 5th. The analysts say in case of the rates hike the Aussie may head to parity with the US currency.
AUD/USD dropped from 0.9694 down to 0.9636 as of 18:12 GMT today after it touched 0.9732, the highest level since July 2008. EUR/AUD went up from 1.4052 to 1.4118, following the decline to 1.4022.
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