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Aust dollar lower at noon, bonds stronger

13 Jan 2009 12:33 PM

SYDNEY, Jan 13 AAP - The Australian dollar was lower at noon as lower commodities prices and slumping equity markets at home and abroad dampened demand for the high-yielding currency.

At 1200 AEDT, the Australian dollar was trading at $US0.6755/58, down 1.8 US cents, or 2.6 per cent, from Monday's close of $US0.6938/42.

During the morning, the local currency moved between $US0.6743 and $US0.6824.

The Australian dollar opened weaker at $US0.6824/26 at 0700 AEDT and continued to move lower at the start of the local trading day.

The local currency was under pressure during offshore trading after commodities prices, particularly gold and oil, fell and the US dollar rebounded.

HiFX senior consultant Derek Mumford said investor nervousness ahead of the US corporate reporting season had also increased the degree of risk aversion in the market.

"The uncertainty in the market and continued bad economic data and uncertainty around the US reporting season is really undermining the Aussie at the moment," Mr Mumford said.

Mr Mumford said there was scope for investors to be disappointed by the latest round of earnings and profit figures, despite lowered expectations as a result of the global economic slowdown.

Crude oil for February delivery fell $US3.24 to settle at $US37.59 a barrel on the New York Mercantile Exchange, its lowest level since December 24.

Gold futures for February delivery slipped $US34 to $US821 an ounce.

The increased risk aversion was also reflected by a stronger Japanese yen.

At 1200 AEDT the Australian dollar was trading at 60.44/51 Japanese yen, down 3.3 per cent from Monday's close of 62.53/60.

The Australian dollar has shed about five US cents over the past four and a half trading days, having started the local session on January 7 at $US0.7249/53.

But Mr Mumford said the move remained within the recent trading range of between $US0.6500 and US0.7500.

"At the moment, we don't see this as the end to any Aussie strength," Mr Mumford said.

"We still see opportunities up towards $US0.7250, $US0.7300 in the weeks ahead."

CURRENCY TABLE: Currency snapshot at 1200 AEDT


AUD/USD 0.6755-58 0.6938-42

AUD/JPY 60.44-51 62.53-60

AUD/EUR 0.5073-83 0.5172-78

AUD/NZD 1.1963-80 1.1810-36

AUD/GBP 0.4579-89 0.4593-01

EUR/USD 1.3311-14 1.3409-12

USD/JPY 89.49-52 90.12-15

EUR/JPY 119.13-17 120.87-90

(*Closes taken at 1700 AEDT Previous local session)

At 1200 AEDT, the Reserve Bank of Australia's trade weighted index was at 55.1, down from Monday's close of 56.1.

Meanwhile, the Australian bond market was stronger at noon.

At 1200 AEDT, the yield on the Commonwealth Government March 2019 bond was at 3.995 per cent, down from Monday's close of 4.100 per cent, while the yield on the April 2012 bond was at 3.172 per cent, down from 3.288 per cent.

On the Sydney Futures Exchange, the March 10-year bond futures contract price was 96.010, up from Monday's close of 95.895, while the March three-year bond futures contract price was 96.835, up from 96.715.


CGS 5.25 pct Mar 2019 3.995 4.100

CGS 5.75 pct Apr 2012 3.172 3.288

90-day bank bill rate 3.910 3.918

180-day bank bill rate 3.577 3.603

Sydney Futures Exchange


Mar 2009 10-yr bond futures 96.010 95.895

Mar 2009 3-yr bond futures 96.835 96.715

Mar 2009 bill futures 96.890 96.830

Jun 2009 bill futures 97.200 97.130