The Australian dollar is trading higher today on the back of stronger oil and iron ore prices.
At 8.33am(GMT) the Aussie dollar was trading at US72.32c up from US 72.26c in yesterday’s trade.
Iron ore, Australia’s biggest export broke through the US$50 a tonne mark overnight, marking it’s highest level since October last year while giving a much needed boost to the Australian dollar.
The rally in the Iron ore price seems to be connected to Chinese building firms restocking their supplies after the Lunar New Year and many expect the price to pullback in the next month as construction gets underway.
The oil price also rose by more than 5% on the back of a report from the International Energy Agency that predicted predicted US shale oil production would fall by 600,000 barrels per day in 2016.
This is on top of the continued negotiations between Saudi Arabia and Russia about reducing oil supplies to the market in a bid to put a floor under the price.
With the RBA seemingly content with leaving Interest rates on hold for the nearest future as well as a growing belief that the US Federal Reserve may delay lifting rates further, the Aussie dollar may receive some more support as we move forward.