The Australian dollar is firmly back below 79 US cents.
At 0635 AEDT on Wednesday, the Australian dollar was worth 78.85 US cents, down from 79.18 US cents on Tuesday.
Westpac’s Imre Speizer says the US dollar has extended its multi-day recovery.
‘The USD index is 0.7 per cent higher on the day, further extending Friday’s rebound from a fresh three-year low,’ he said in a morning note on Wednesday.
‘The AUD fell from 0.7934 to 0.7880.’
Domestically, the main event risks for the local currency on Wednesday woul be Australian Bureau of Statistics data on December wages and construction.
‘The fourth quarter Wage Price Index is expected to rise 0.5 per cent.
‘Last quarter’s release surprised to the downside at 0.5 per cent vs expectations for 0.7 per cent (associated with the higher than usual 3.3 per cent increase in the minimum wage).
‘Fourth quarter construction work done is expected to fall back 10 per cent after Q2’s +9.8 per cent and Q3’s +15.7 per cent.
‘(However,) the survey has been an unreliable partial indicator lately due to the treatment of imported LNG platforms.’
On Wednesday, he thought the local currency ‘should remain under downward pressure today, 0.7880 vulnerable, given the recently firmer US dollar’.
Meanwhile, the Aussie dollar is hardly changed against either the yen or the euro.
CURRENCY SNAPSHOT AT 0635 AEDT ON WEDNESDAY
One Australian dollar buys:
* 78.85 US cents, from 79.18 on Tuesday
* 84.59 Japanese yen, from 85.60 yen
* 63.92 euro cents, from 63.94 euro cents
(*Currency closes taken at 1700 AEDT previous local session)