PERTH: The Australian dollar hit successive one-month lows against the surging US dollar in morning trading today.
The local unit dipped as low as US77.26c just before noon after a slow, tentative rally topped out at US77.50c when the US dollar headed higher again.
The Australian dollar was worth US77.37c at noon (AEST), down from US77.96c yesterday.
The driving force behind the US dollar, which hit an eight-year high of 123.3 yen overnight then repeated the feat just after 11am, was a bout of positive economic data.
“The US dollar found a solid bid as markets found reasons to be optimistic from the latest US data dump,” ANZ’s economic research team said in a note.
The figures included orders for durable factory goods, which rose by 0.5 per cent after excluding the volatile transportation equipment component, making it the second consecutive rise after a lull intensified by unusually bad winter weather.
And new home sales in the US bounced back in April after a March fall to be up by 26.1 per cent from a year earlier.
The figures underscored a comment from Federal Reserve chair Janet Yellen on Sunday that it will likely be appropriate “at some point this year” to start raising the benchmark federal funds rate.
Chief market analyst at CMC Markets, Ric Spooner, said the firmer expectations for a rise in US interest rates helped push the US dollar up, but that it may not have been the whole story. “While this ‘good news is bad news’ theme heightened expectations of a Fed rate hike and helped push the US dollar higher, market action last night also bore some hallmarks of flight-to-safety activity by traders,” he said.
