Investing.com - The Australian dollar weakened mildly on
Wednesday after a bank survey showed consumer sentiment fell in
December to the lowest level since July, raising the prospects for
a cash rate cut by the Reserve Bank of Australia when its board
next meets in February.
AUD/USD traded at 0.9146, down 0.05%. after a survey by
Westpac-Melbourne Institute showed consumer sentiment dropped 4.8%
to 105.0 in December along with long-term outlooks for the economy.
"Westpac has maintained a forecast for another rate cut of 25bps at
(the) February meeting for some time," said Westpac chief economist
"It may be that the interaction of forces which we envisage takes
longer to become apparent to the Board and the rate cut decision is
delayed for some months. Of particular concern here is whether the
housing data over the next few months is sufficiently reliable. For
now, we retain our call for a cut in February while fully
recognizing that a delay to that move is also a realistic outcome."
Overnight, renewed uncertainty as to whether or not the U.S.
central bank will wait until early 2014 after reviewing more data
before deciding on tapering softened the greenback.
Major currencies in Asia were lightly traded with USD/JPY at
102.83, down 0.02%, following October core machinery orders data
that met expectations of a 0.6% increase.
The euro overnight saw continued support on a surprise European
Central Bank decision to hold off on implementing fresh monetary
stimulus measures at its December meeting, including introducing
negative interest rates, after surprising investors with a rate cut
EUR/USD traded at 1.3764, up 0.03%.
In a speech on Tuesday, ECB President Mario Draghi urged
governments to complete a banking union, saying it was crucial at
both a national and European level.
The dollar index, which tracks the performance of the greenback
versus a basket of six other major currencies, was up 0.01% at
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