Aussie dollar falls below US$0.69

Daily Currency Update

The Australian dollar is slightly weaker this morning when valued against the Greenback currently trading at US$0.6880 at the time of writing. The Aussie dollar faces slight selling pressure as the Greenback bounces back strongly after the Federal Reserve (Fed) Chair Jerome Powell pushed back market speculation for another interest rate cut of 50 basis points (bps) in November. Meanwhile, the near-term appeal of the Australian dollar remains firm as Australia’s economic outlook has been improved by China’s massive liquidity stimulus. On the local data front yesterday ABS data showed that total dwellings approved last month fell 6.1% to 13,991. That partially reversed the 11% increase in July (up from 10.4% previously). Private-sector house approvals rose 0.5% to 9,338 in August following a 0.9% rise in July. Private house approvals are now up 20% from the unexpected low of 7,713 in January of this year. The totals for July and August were the highest monthly figures since late 2022. Excluding houses, private-sector dwellings fell 16.5% to 4,418, as approvals for apartments, units, townhouses and the like dropped. That was half the 32.5% jump in July as a backlog of approvals in local government was cleared. Looking forward to the rest of the week and on Thursday we will see the release of the Goods Trade Balance. Export demand and currency demand are directly linked because foreigners must buy the domestic currency to pay for the nation's exports. Export demand also impacts production and domestic manufacturers' prices.