Australian Dollar up on expected rate hike

Australian Dollar up on expected rate hike

09-29-2009 13:57

The Aussie, an informal term for the Australian Dollar, has posted one of the 5 best results as the worldwide economy started to improve and as a result of speculations concerning a possible interest rate hike, driving the South Pacific currency to rise against its main rivals today. Rumors about an interest rate rise boosted Australia’s currency to climb for a third consecutive day, pushing the Aussie up to the highest level in more than a year against the majority of all six main traded currencies. In the meantime, the probability that Australia's central bank will raise its benchmark interest rate increases every day, which makes the Australian Dollar more attractive for traders. Rising optimism in the South Pacific region has a positive effect on the Aussie as it also boosts the New Zealand economy that is improving at a faster pace than the economies of other industrialized countries, creating a more optimistic trend for the Kiwi Dollar, while it also impacts the Australian economy in a broader prospect.

Australian Dollar up

It is expected that Australia will be the first nation to increase its interest rates, if so, this will push the Australian Dollar further up, mostly against the main traded currencies and currencies that are likely to show rate increases. The Aussie-rate will probably remain high as it will continue to find support in the near future since this trend is likely to persist until the end of 2009.