Newspaper article The Chronicle (Toowoomba, Australia)

Aust Dollar Unlikely to Rise Further

Newspaper article The Chronicle (Toowoomba, Australia)

Aust Dollar Unlikely to Rise Further

Article excerpt

SYDNEY: The Australian dollar is unlikely to appreciate much further in 2011 and may even fall after a stellar year in which it hit parity with the US currency after 27 years.

The currency reached one US dollar in November as investors were attracted by Australia's economic strength and the commodities boom fuelled by Asian demand.

At the same time, investors shied away from the weak US economy following the global financial crisis.

The strong local economy meant Australian interest rates were among the highest for developed economies, particularly compared with cash rates that were close to zero in the US, Europe and Japan.

While the fundamental reasons for the Australian dollar's strength remain, analysts are divided as to whether the local currency can stay near parity with the US dollar as other currencies may gain as their economies recover.

The Australian dollar rose almost 20 US cents since June to its peak of 101.98 US cents on December 30. …

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