The Australian Dollar has risen to a 3-month high on speculation of another interest rate hike due to rising inflation. The Australian Dollar's rise was the best among the major currencies during this past month due to speculation of rising inflation and growth. A government report this week may show the lowest unemployment rate since 1974 is adding to signs wage increases may further rise. Investors have ignored the slowing global economy to buy the rising Australian Dollar to benefit from the biggest government bond yield advantage over US Treasuries in 17 years. The nation's two-year government bonds yield 5 percentage points more than similar maturity Treasury notes, near the 5.03 points reached last week, the widest gap since 1990.
''Tomorrow we get a speech from Assistant Governor Edey and Wednesday we get some very important labor data,'' said Tony Morriss, a currency strategist at Australia & New Zealand Banking Group Ltd. in Sydney.
''Those events should lend some support to the Aussie in terms of the interest-rate outlook.''
The Australian Dollar has risen to a 3-month high in forex trading, climbing to 91.26 U.S. cents, the highest since the 9th of November, before trading at 91.18 cents. The Reserve Bank of Australia (RBA) is expected to increase its interest rates by 25 basis points to 7.25 percent when they meet on the 4th of March. It will be the fourth increase in eight months.
We recommend trading forex with Easy-Forex.
