PERTH: The Australian dollar has fallen to a three-week low as weaker-than-expected inflation leaves room for the Reserve Bank to cut the cash rate.
At noon (AEDT), the currency was trading at US71.26 cents, down from US72.53 cents yesterday.
Inflation in the year to September was unchanged at 1.5 per cent after a weaker-than-expected rise in the September quarter of 0.5 per cent.
The Australian dollar dropped half a US cent when the data was released at 11.30am (AEDT).
“The number is much lower than expected and presents absolutely no obstacle for the Reserve Bank of Australia to lower rates,” OANDA Australia and Asia Pacific senior trader Stephen Innes said.
“The door is open and the RBA will likely walk through it.”
The local currency fell below US72 cents in overnight trade due to weaker commodity prices.
