Futures Market News
South Pacific dollars slip against greenback
Apr 17, 2012 10:43 AM
The dollars of Australia and New Zealand fell in value against the U.S. dollar on Tuesday, pulled down by widening concerns for Spain and the sovereign debt crisis attacking it, Bloomberg reports.
The South Pacific monetary units marked three-straight days of losses against the world's reserve currency as the Aussie also was tugged down by Reserve Bank of Australia minutes signaling it will reduce interest rates should inflation ease. The Kiwi followed global shares' downward drive, which was the consequence of increasing Spanish borrowing costs.
"The RBA definitely remains on an easing bias and that was enough to take the shine off of the Aussie dollar," currency strategist Jonathan Cavenagh with Westpac Banking in Singapore told Bloomberg. "Given that the market was already largely priced for an easing, I still expect demand to come back around the $1.0310-$1.0320 region."
On Monday, yields on Spanish bonds climbed to 6.16 percent, representing the highest they've been since early December of 2011.
The central bank of Australia also will slash interest rates should demand remain weak, The Sydney Morning Herald reports.
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