Time to sell Aussie dollar?

Financial and commodity markets analytics

The Australian dollar is riding high at the moment and travelers are being told to take advantage of the high currency rate before it is too late.

The local currency hit an 11 month high this week, threatening to push through the US80c mark on the back of rising commodity prices and a feeling by some in the market that the US Federal Reserve will hold off raising interest rates for some time.

The value of the Aussie dollar is also creating a headache for the RBA as a strong currency is likely to derail the recovery of the Australian economy which is making the delicate transition after the end of the mining boom.

In their last meeting the RBA left the door open for a rate cut if inflation continues to remain weak but many predict it is possible they could also slash rates if the Australian dollar remains strong.

The focus next week will be on the latest interest rate decision from the US Federal Reserve where no changes in rates are expected but a bullish tone may set the scene for a rate hike in June.

CPI numbers from Australia are also due to be released, with poor figures likely to have traders placing their bets on a rate cut from the RBA which is likely to send the Aussie dollar lower.


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