The Australian dollar is holding steady today after a jump overnight in commodity prices and fears of further damage by Britain decision to leave the European Union subside.
At the beginning of the trading session today the Aussie dollar was fetching 74.72c up from US72.50c in yesterday’s trading.
Since reaching a low of US73.06c after the British referendum, the Aussie dollar has been gaining ground helped by comments from the Bank of England that it will do whatever it takes to shore up the economy and counter the effects of any fall out from Brexit.
There are still no clear cut terms on England leaving the EU including a deal over trade and freedom of movement but traders feel relaxed for the time being,
“The odds may be against them but investors are hoping that the worst is over for currencies and equities,” noted BK Asset Management managing director of FX strategy Kathy Lien .
Ms Lien also added that with so much uncertainty ahead investors need to be cautious,
“Considering there’s been had no additional clarity on the terms of Brexit or the outlook for the UK economy and global economy we don’t see fundamental support for the recent moves” she said.
Also helping the Australian dollar was a bounce in the price of oil and Iron ore overnight which is Australia’s biggest export.
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