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Australian dollar falls slightly lower

Xinhua, May 18, 2016 Adjust font size:

The Australian dollar fell against the greenback in overnight trade, amid talk of a U.S. interest rate hike.

At 7:00 a.m. local time (AEST) on Wednesday, the Australian dollar was trading at 73.25 U.S. cents, down from 73.51 U.S. cents on Tuesday.

By 9:46 a.m. local time (AEST), the Australian dollar had fallen slightly to 73.14 U.S. cents.

Commonwealth Bank of Australia senior currency strategist Elias Haddad said in a note on Wednesday the Australian dollar had pared back some of Tuesday's gains during the overnight trade.

"The Reserve Bank of Australia (RBA) has significantly revised down its inflation and wage cost outlooks with underlying inflation only expected to creep up into the 2 to 3 percent target band by mid-2018," Haddad said.

Westpac senior market strategist Imre Speizer said the U.S. dollar remained at a multi-week high, supported by strong U.S. data overnight, as well as some hawkish Fedspeak.

"Commodities firmed slightly, but equities fell on the increased chances of U.S. interest rate hikes," Speizer said.

IG market analyst Angus Nicholson added there doesn't seem to be a strong driver for the Australian dollar at the moment.

"We may expect it to trade in a range between 72.40 U.S. cents to 73.80 U.S. cents," Nicholson noted. Endit