The Australian dollar fell after another batch of good US economic data cemented hopes of a winding down of economic stimulus measures by the US central bank.
At 7am AEST the local unit was trading at 96.16 US cents, down from 96.55 cents at yesterday’s local close. Since 5pm AEST the Australian dollar traded between 95.97 US cents and 96.97 cents.
During the offshore session, it was reported that consumer confidence in the US rose in May for a second consecutive month to a five-year high.
The data gave investors more reason to believe the US Federal makes would taper off its $US85 billion a month bond buying program, designed to encourage banks to lend.
Westpac New Zealand senior market strategist Imre Speizer said the US dollar rallied after the figures were released.
“A strong US dollar from strong US data, the Aussie dollar is weak, I think it will have a crack at breaking below 96.00 US cents today and that would be a big deal,'' Mr Speizer said.
“We're back to the old normal relationship where good US data is good for the US dollar.''
The Australian Bureau of Statistics will release March quarter construction work done figures today, which Mr Speizer said will be of interest to the market.
