Australian dollar rises against weak greenback

first_imgThe Australian dollar has continued to perform remarkably well against the greenback, surging through the 95-US-cent mark in overnight trading. The latest rise saw the dollar reach 95.64 US cents overnight – its highest level in two years – it then dropped slightly back to 95.53 US cents by 7am (AEST).Since May, the Australian dollar has managed to rise an impressive 17.2 per cent, mainly due to the strong domestic economy, relatively higher local interest rates and a weak US dollar.  While a stronger Australian dollar will make overseas travel and imports cheaper it could also make holidays in Australia more expensive, which would have a negative impact on the travel industry.  Due to this strong performance, there has now been speculation that the Australian dollar may reach parity with the US dollar, something that hasn’t occurred since it was floated in 1983. The Australian dollars peak since the currency was floated was in July 2008 before the global financial crisis, when it reached 98.5 US cents.Bloomberg has revealed data which indicated that the dollar is 27 per cent too expensive, with predictions it could drop 6 per cent by the end of 2010. Source = e-Travel Blackboard: C.Flast_img