By Dow Jones Business News, October 29, 2013, 09:31:00 AM EDT
By Clare Connaghan and James Glynn
The Australian dollar slumped to a two-week low against the U.S. dollar Tuesday after the country's central bank
governor warned the currency was overvalued.
The Aussie, as the currency is commonly called, was down around 0.6% against the buck Tuesday after Reserve Bank of
Australia Governor Glenn Stevens said the Australian dollar's current level wasn't consistent with underlying economic
conditions and warned it is likely to weaken over time in line with falling commodity prices.
"Recent statements from the RBA expressing a desire for a weaker Australian dollar have intensified over the past
week," foreign-exchange strategists at Morgan Stanley said in a note to clients.
Such comments, alongside the Australian dollar's exposure to monetary tightening in China, make it one of the "most
vulnerable of the G10 currencies," the bank's strategists added.
More broadly, the U.S. dollar was stronger against the yen, euro and pound Tuesday as U.S. retail sales data were
published at 1230 GMT.
In emerging markets, the Indian rupee firmed against the U.S. dollar after India's central bank raised its repurchase
rate to 7.75% from 7.50%. Responding to the recent recovery in the rupee, the Reserve Bank of India also said it would
continue to roll back the liquidity restrictions on local banks imposed in July to arrest a freefall in the local
The Hungarian forint remained under pressure against the euro Tuesday after the central bank cut its headline interest
rate to a record low 3.40% from 3.60%.
Forex spot: EUR/USD USD/JPY GBP/USD AUD/USD WSJ Dollar Index
Spot 1240 GMT 1.3759 97.98 1.6075 0.9498 72.10
NY Close 1.3785 97.67 1.6155 0.9571 71.896
Write to Clare Connaghan at email@example.com
Corrections & Amplifications
This item was corrected at 1616 GMT because it misstated U.S. retail sales data were to be released at 1330 GMT in the
fifth paragraph. The data were published at 1230 GMT.
(END) Dow Jones Newswires
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