Aussie Dollar hit lowest level since July 2010 against Sri Lankan Rupee Featured

Wednesday, 10 December 2014 00:00 Written by  Published in Australia News

Disappointing economic growth figures on Wednesday have left Australia’s leading economists rethinking their interest rate forecasts, with several now expecting the cash rate to fall to new record lows in 2015. Dollar has stabilised after hitting fresh lows overnight, amid growing expectations that the central bank will need to cut rates again.

 

above Graph shows historical exchanges rate Australia Dollar vs Sri Lankan Rupee

Both Westpac and AMP Capital have scrapped forecasts of rate hikes next year and now predict two further cuts from the Reserve Bank, taking the cash rate to a new record low of two per cent. The Australian dollar fell to 83.56 US cents overnight, its lowest level since July 2010.

Better-than-expected retail and international trade figures on Thursday gave the Australian dollar a slight boost but the enthusiasm was short lived as rate cut talk weighed on the currency, BK Asset Management managing director Boris Schlossberg said.

“The sentiment towards the Australian dollar/US dollar has changed radically this week after a shockingly weak GDP reading,” Mr Schlossberg said.

“The market is now much more receptive to the prospect of a rate cut from the RBA should growth slow down further.

“With rate expectations now tilted towards easing the pair remains under heavy selling pressure.”

 

 

Last modified on Wednesday, 10 December 2014 22:34
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