Australian dollar dips below 81.0 US cents for first time since early April |
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Published
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Thu, 16 Aug 2007 05:24
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SYDNEY (Thomson Financial) - The Australian dollar fell below 81 US cents for the first time since early April in afternoon trade Thursday as the unwinding of carry trades spread to broader based risk aversion sales in the forex market.At 2.00 pm (0300 GMT) the Australian dollar was at 80.39 US cents.'This is not just carry trades being unwound, it is going much further ... we are in a 100 percent flight to quality move,' said Robert Rennie, head of foreign exchange strategy at Westpac Banking Corp.Rennie said once the currency fell through technical support to 81.30 cents, there was little to stop it sinking further.'We kept on going and straight through the other side - it was one of those areas that people would have been looking for a bounce but it didn't materialise.'He said the local unit might see some support on Friday if Reserve Bank of Australia governor Glenn Stevens soothes investors' nerves when he answers questions before a parliamentary economic committee.'Tomorrow I think we will get a bit more clarity. Glenn Stevens has the unenviable task of ...standing up in front of parliament and answering questions about the current turmoil,' Rennie said.'I think until we start to get some direct commentary from the central bank head this heightened degree of nervousness is going to continue.'bruce.hextall@thomson.combh/mb-bhx/mbCOPYRIGHTCopyright AFX News Limited 2007. All rights reserved.The copying, republication or redistribution of AFX News Content, including by framing or similar means, is expressly prohibited without the prior written consent of AFX News.
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Australian shares rise in early trade as market jitters ease 