THE dollar was slightly higher at noon as it traded in a tight range in the wake of the release of steady employment figures yesterday.
At 12pm (AEDT), the dollar was $US0.9155/57, up 0.25 per cent from Thursday’s close of $US0.9139/44. Since 7am (AEDT), the local unit has traded between $US0.9140 and $US0.9163. Commonwealth Bank currency strategist Richard Grace said the local unit was trading in a tight range during the morning trade, moving up slightly following steady employment figures on Thursday.
“It’s been in such a narrow range. I wouldn’t read too much into it but I think you could say those employment numbers had more of an effect than the Chinese CPI.” Chinese consumer prices spiked to 2.7 per cent in February year on year, up from January’s 1.5 per cent increase, China’s National Bureau of Statistics reported on Thursday (AEDT).
It was well above most analysts’ forecasts. Mr Grace said the dollar was marginally higher than it was prior to the release of the employment data. He said the local unit was less than 1 per cent away from the cyclical high against the euro of US$0.6754 recorded on March 10. “The Australian dollar really hasn’t done anything,” he said. But it was possible the highs against the euro could be retested in afternoon trade, he said. “I’m not sure what the driver would be at this stage, but if it drifts back up there it could do so just on general flow rather than any news event.” He said there was little data to drive the currency until the release of US retail sales figures in the overnight session. “Data in the US is being very affected by snow storms.”
He said there was a risk that US retail sales would be much weaker than the market consensus of a 0.1 to 0.2 per cent fall. “Unless there’s a massive reaction I would think we’ll continue to see a narrow range of trading until the end of the week.”
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