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Dollar tracks below US90c

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The Australian dollar has dropped to a one-week low after weak US wholesale sales data gave traders another excuse to sell the currency.

Early Wednesday, the local unit was trading at 89.64 US cents, down from 90.26 cents on Tuesday.

The US Commerce Department said sales from wholesalers fell 1.9 per cent in January, the biggest drop in four years.

Westpac New Zealand senior market strategist Imre Speizer said the data added to negative market sentiment brought about by ongoing tensions between Ukraine and Russia and concerns about a slowdown in Chinese economic growth.

“Markets extended the previous day’s defensive posture,” he said.

“US data was minor but disappointing, nonetheless, small business confidence and wholesale trade both falling. Ukrainian tensions continued.”

Speizer said the Australian dollar could fall below 89.50 US cents, with weakness in metal prices not helping the currency.

Local economic data out ontoday includes the release of the Westpac consumer sentiment index for March and official housing finance figures for January.

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