Aussie dollar up on positive trade data

Published: 3 Apr at 9 AM Tags: Euro, Dollar,

The Aussie dollar has inched up against the US dollar because of positive trade data for February. According to the Australian Bureau of Statistics, the country’s trade balance contracted to AU$178 million during February from January’s deficit of AU$1.215 billion. Although exports are expected to continue to grow through the rest of the year, economists are also predicting that prices will fall.

A decision by the Reserve Bank of Australia to keep interest rates at 3 per cent has also helped to support the Aussie dollar as has positive economic data coming out of China, the country’s main trading partner.

The US dollar has managed to climb against the yen and the euro as the European Central Bank and the Bank of Japan hold policy meetings this week. BoJ leader Haruhiko Kuroda is expected to announce bold stimulus plans and ECB President Mario Draghi is likely to announce that interest rates in the eurozone will remain at 0.75 per cent.

The latest manufacturing data from the region shows a contraction last month. The euro hit $1.2804, down 0.1 per cent against the greenback. The pound has also slipped against the US dollar to $1.5086, a 0.1 per cent drop as the UK also announced disappointing manufacturing figures.

A meeting at the Bank of England could result in further bond buying in an effort to boost the economy.