The Australian dollar is trading in a tight range today holding up pretty well after last week’s shock decision by the Swiss Central Bank to lift the ceiling on the Swiss Franc against the Euro, which sent currency markets reeling, and saw the Aussie tumble against the US dollar.
At 1.55pm (AEDT) the local currency was trading at US81.22 cents slightly down from US81.32 cents at close of trade on Friday.
Also helping the Australian dollars cause today was the release of new motor vehicle sales in Australia which rose a seasonally adjusted 3.0% to 93,903 in December according to the Australian Bureau of Statistics although the overall picture shows total sales are now a seasonally adjusted 1% lower than a year earlier.
The ride for the Aussie dollar above US82.00 cents is not expected to last for long according to BlackRock head of fixed income Stephen Miller who says the overall picture of the Australian economy isn’t good and we may see the dollar significantly lower in the next few months,
"The Australian dollar is a sell. The economy is weaker, terms of trade are down, we have sub-trend growth and potentially the lowest nominal growth in 50 years”
"There are lots of headwinds and that will be reflected in our currency. I won't be surprised if we see below US70 cents in the first half of 2015."
BlackRock, the world’s largest asset manager has been calling for the Australian dollar to fall further for quiet sometime.
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