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Dollar's rise continues


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The Australian dollar continues to climb after a series of stronger-than-expected economic data boosts confidence in the local economy.

Early Friday the local unit was trading at 90.96 US cents, up from 90.12 cents on Thursday.

The Australian dollar rose above 90 US cents on Thursday after the release of surprisingly strong retail sales figures and a large rise in the trade surplus.

This followed Wednesday’s better-than-expected gross domestic trade figures.

The data have given traders confidence in the Australian economy and lifted demand for the Aussie, OM Financial senior client FX adviser Stuart Ive said.

“A series of better-than-expected data has resulted in a much more positive outlook for the Australian economy,” he said.

“That, combined the situation in the Ukraine, where all parties are sitting around the table and fears of a military confrontation have eased, have seen risk come back.”

Figures released by the Australian Bureau of Statistics on Thursday showed retail spending jumped 1.2 per cent in January, dwarfing the 0.4 per cent rise economists had expected.

The ABS data also showed Australia recorded a $1.4 billion trade surplus in January, the strongest in two-and-a-half years, thanks to stronger resources exports.

Meanwhile, GDP expanded 0.8 per cent in the last three months of 2013, for an annual rate of 2.8 per cent.

Traders await US non-farm payroll data to be released on Friday night, Australian time.

Ive said if the data was weaker or stronger than expected the Australian dollar could climb higher.

“It could rise if the data weakens the greenback or if the data beats expectations, it still could rise because it’s a sign the global economic situation is improving,” he said.

“I think the Aussie dollar is edging towards 92 US cents.”

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