Australian Dollar Edges Lower against the Dollar in Early Monday Trade

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Australian Dollar Edges Lower against the Dollar in Early Monday TradeThe Australian dollar fell against the dollar on Monday morning in Sydney on strong US economic prospects.

The Aussie traded at 92.36 US cents at 7 a.m. local time, which was lower than Friday’s close of 92.41 cents, reported The Australian.

A report released last week showed that new home sales in US rose while the Markit Economics’ manufacturing purchasing managers’ gauge surged to 56.2 this month, boosting the US dollar. According to Kymberly Martin, a market strategist at Bank of New Zealand, national holidays in UK and the US means today will likely result in little activity for the Australian dollar.

“It was a quiet end to last week across all the currencies probably reflecting the fact that there wasn’t a lot of data and also given that it’s a long weekend in the US and UK today,” Ms Martin said. “Traders would have been reticent to put on long positions ahead of the long weekend. There’s no real data out for Australia today so it’s looking like fairly tight ranges for the start of the week.”

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The stronger Aussie has got most Australian businesses worried, including mining giants Rio Tinto and BHP Billiton, over the effect it may have on their balance sheet and earnings. The currency is currently trading at an average of US 92 cents, about 8 cents more than its value at the start of this year. The currency failed to drop by any meaningful margin after data last week showed that iron prices and consumer confidence fell. To register for a free 2-week subscription to ForexMinute Premium Plan, visit www.forexminute.com/newsletter.

To contact the reporter of this story; Yashu Gola at yashu@forexminute.com