Aust dollar rises above 72 US cents, highest in three months
03 Apr 2009 11:25 AM
SYDNEY, April 3 AAP - The Australian dollar marked a fresh three month high on Friday after rising above 72 US cents in morning trading.
The local currency hit 72.28 US cents around 1117 AEST, building on a rally that began overnight after measures announced at the Group of 20 meeting in London to restart the global economy.
It was up 1.97 US cents from a local close of 70.31 US cents on Thursday, after opening the Friday session at 71.58 US cents.
It was the highest level in the currency since the first week of January when it peaked at 72.68 US cents.
The jump came after the Australian stock market soared almost two per cent after the open, following gains made in offshore markets build on a spike in optimism after by the the G20 leaders summit.
Kinetic Securities chief economist Clifford Bennet said the Australian dollar had a "great rally" and was expected to build on its gains.
"Our medium term target remains 79 US cents," he said.
"We have had 69 and 79 US cent targets all year on the expectation of the world economy doing better than consensus expectations and Australia having a momentary recession only."
In London, world leaders agreed to inject hundreds of billions of dollars into the International Monetary Fund and trade finance and pledged to spend $US5 trillion ($A7.17 trillion) on the global economy by the end of 2010.
Treasurer Wayne Swan said on Friday that all the measures discussed during the meeting would support global growth and benefit Australia.
"Any measure, globally, which further supports growth in jobs is very important for Australia because it assists the stimulus that the Australian government has put in place to support growth and jobs," he said.
Bank of New Zealand currency strategist Danica Hampton said on Friday that financial markets were upbeat about the steps announced in London.
"The idea that the world is on the road to recovery and perhaps we are going to pull out of this quicker than expected has really encouraged demand for growth-sensitive currencies like the Australian dollar," she said.
