Aust dollar closes lower as market awaits key US jobs data
By Ed Logue and Jordan Chong05 Dec 2008 5:53 PM
SYDNEY, Dec 5 AAP - The Australian dollar has closed marginally weaker in subdued trading as financial markets await a potentially dire jobs report from the United States on Friday night.
At 1700 AEDT, the Australian dollar was trading at 64.44 US cents, down slightly from Thursday's close of 64.52 cents.
During the day, the local unit traded between 64.20 US cents and 64.61 US cents.
ABN Amro currency strategist Greg Gibbs said the Australian dollar traded in a narrow range for the local session, as it had for the past week.
"It has probably held up quite well, considering the falls in commodity prices we have seen this week, including further falls in base metals and oil," Mr Gibbs said.
"Possibly it has held up because when the RBA (Reserve Bank of Australia) cut rates this week they suggested they are not going to be in a real hurry for further big cuts.
"Although there are further anticipated cuts."
Mr Gibbs said movements in the risk-sensitive Australian dollar were still related to share markets.
Australian bourses closed about 1.2 per cent lower on Friday following a poor lead from Wall Street.
"The Aussie is still beholden to the equity market basically," he said.
"Equities in the US have been choppy and directionless this week, equivalent to what the Aussie has been."
The market would gain direction from the US non-farm payrolls data for November due on Friday night, Mr Gibbs said.
Economists were expecting monthly job losses of 330,000, worse than the 240,000 jobs lost in October.
The US jobless rate is expected to rise to 6.8 per cent from 6.5 per cent.
Also, the chief executives of the big three US car companies - Ford, General Motors and Chrysler - were due to appear before the US Congress, seeking financial support for their troubled firms.
"The response to the employment figures will be important, as well as hearing more about the auto makers tonight," Mr Gibbs said.
At 1700 AEDT, the local currency was trading at 59.49 Japanese yen, down from Thursday's close of 60.02 yen, and at 50.52 euro cents, down from 50.87 euro cents.
The euro finished at 1.2754 US dollars, up from Thursday's close of 1.2680 US dollars and at 117.74 Japanese yen, down from 117.98 yen.
The US dollar closed the local session at 92.33 Japanese yen, down from 93.04 yen.
Meanwhile, the Australian bond market closed weaker after giving up overnight gains during local trading ahead of a key US employment report.
At 1630 AEDT, the yield on the Commonwealth Government March 2019 bond was at 4.288 per cent, up from Thursday's close of 4.252 per cent, while the yield on the June 2011 bond was at 3.497 per cent, up from 3.467 per cent.
On the Sydney Futures Exchange, the December 10-year bond futures contract price was at 95.715, down from Thursday's close of 95.745, while the December three-year contract price was at 96.460, down from 96.495.
Commonwealth Bank of Australia interest rate strategist Jarrod Kerr said the bond market weakened slightly, but traded sideways for most of the local session.
"They opened on their highs and then sold off over the day," Mr Kerr said.
"We're looking to payrolls tonight."
The 90-day bank bill rate closed at 4.658 per cent, up from Thursday's close of 4.400 per cent, while the 180-day bank bill rate was at 4.000 per cent, up from 3.910 per cent.
At 1600 AEDT, the Reserve Bank of Australia's trade weighted index was at 53.8, down from Thursday's close of 53.9.
