The Australian dollar is back above 76 US cents after news that former Trump security adviser Michael Flynn had pleaded guilty and was prepared to testify against the US president regarding Russian involvement in the presidential election dented market sentiment.
At 0635 AEDT on Monday, the Australian dollar was worth 76.04 US cents, up from 75.64 US cents on Friday.
Westpac’s Imre Speizer says the impact of the Flynn news was partially offset by the likelihood that the Senate would pass the Republican’s tax reform package.
‘The US dollar index closed Friday down 0.2 per cent on the day, falling sharply on the Flynn news but recovering on the tax vote news,’ Mr Speizer said in a morning note.
‘(The) AUD rose from 0.7560 to 0.7640.’
Also of interest to markets was US construction spending which rose 1.4 per cent in October, which was much better than the anticipated 0.5 mainly.
And, ISM manufacturing slipped from 58.7 to 58.2, which was still an elevated level and not much different to the 58.3 expected, Mr Speizer said.
The key local event risk on Monday would be third quarter company profits, he said, with the local currency not expected to move dramatically.
‘(It’s been) rangebound since 21 November between 0.7530 and 0.7645.’
The Aussie dollar is also higher against the yen and the euro.
CURRENCY SNAPSHOT AT 0635 AEDT ON MONDAY
One Australian dollar buys:
* 76.04 US cents, from 75.64 on Friday
* 85.75 Japanese yen, from 85.14 yen
* 64.12 euro cents, from 63.42 euro cents
(*Currency closes taken at 1700 AEDT previous local session)