Dollar drops as presidential election takes centre stage

Published: 7 Nov at 9 AM Tags: Euro, Dollar,

The dollar has dropped slightly on the Asian markets as investors wait for the results of the presidential election in the US. The dollar index fell from a high on Monday of 80.843 to 80.622. Expectations that austerity measures will be approved by the Greek parliament have helped the euro to jump from a low of $1.2764 to $1.2800. An agreement is needed in order to secure further aid from international lenders.

The market appears to have positioned itself for a win by Obama and if this happens the focus will switch to the situation in Europe and a meeting by the Central Bank to discuss the situation in Spain. The recession ravaged country is still to request a sovereign debt bailout.

The Australian dollar has been performing well after interest rates were left unchanged by the Reserve Bank of Australia. The Aussie hit $1.0447, a rise of 0.7 per cent, and the highest it has been in more than five weeks. The currency is also up against the euro, which is down to A$1.2236, and the yen, against which it is up to 84.04 yen.

Investors are waiting to see the latest data on Australian employment, which is due out later in the week, as well as figures coming out of the country’s largest export market, China.

It is likely that Australia will cut its interest rates again at some point as the global economy continues to show slight signs of recovery.