Australian dollar falls

dollar14 (1)The Australian dollar has fallen slightly against its US counterpart after soaring above 80 US cents only minutes after the Reserve Bank of Australia left the official cash rate unchanged at 1.5 per cent.

At 0630 AEST on Wednesday, the Australian dollar was worth 79.69 US cents, from 80.02 US cents on Tuesday.

The local currency was a touch over 76 US cents when the RBA met in July and was trading at around 80 cents when the board began its August meeting on Tuesday.

It rose in the minutes following the RBA’s 1430 AEST announcement, to 80.35 US cents, before later lowering to lose the initial gains.

Much of the local dollar’s gains in the past month have been driven by broad US dollar weakness and a partial recovery in Australia’s key commodity prices, after very steep declines in April and May, according to Westpac Global Strategy Group.

“However, beyond multi-week gains, a firmly on hold RBA is likely to keep a lid on AUD/USD, easing to 0.74 by year-end,” the group said on Wednesday.

The Australian dollar was also down against the Japanese yen and the euro.

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