The Australian dollar is down sharply against its US counterpart as expectations of a lift in US interest rates supports the greenback.

At 0635 AEDT on Wednesday, the Australian dollar was worth 75.87 US cents, down from 76.16 US cents on Tuesday.

The US dollar has edged higher against a basket of currencies but is still below highs hit in December and January after two weeks in which expectations for a rise in US interest rates this month have soared.

Brown Brothers Harriman’s CurrencyView said that following the Reserve Bank of Australia’s announcement that it was keeping its cash rate on hold at 1.5 per cent, the Aussie raced through 76.30 US cents but quickly slipped back below 76.00 US cents.

The local currency is also lower against the yen and the euro.

AAP

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