The Australian Dollar struck a 2-month trough against its US counterpart during London trade on Wednesday as indications of a slowdown in the Australian economy are supporting analysts' expectations that the Reserve Bank of Australia will likely lower interest rates. A more dovish outlook is also expected from the Bank of Canada which resulted in a fall for the Canadian Dollar versus the greenback. Both central banks would be following the path carved out by a majority of major central banks given the waning momentum of the global economy.
As reported at 11:37 am (GMT) in London, the AUD/USD was trading at $0.7027, down 0.6967% and off the session trough of $0.70242 while the high for the trading day was recorded at $0.70922. The NZD/USD was also lower, trading at $0.6778, down 0.2076%; the pair has ranged from $0.67532 to $0.68016. The USD/CAD was trading at C$1.3374, up 0.1273%, off the session peak of C$1.33830.
Dollar Lifted by Data
Analysts say the US Dollar is finding some support from unexpectedly strong data in recent days. The latest comes from the Markit Surveys which reported that the US Services sector reading came in at 56.0 in February, slightly below the 56.2 expected. The ISM-Non-Manufacturing Reading came in at 59.7, beating analysts' forecasts of a rise to 57.3. It was also reported that new home sales were unexpectedly higher in February on a month-to-month basis.