Inflation data pulls USD lower

The ASX 200 has fallen 1.2% or 68 points to a three week low of 5,693 as tensions between the US and North Korea intensify. Over the week, the index is down 0.5%.

Disappointing US inflation data pushed the greenback down.

THE Australian dollar is higher against its US counterpart which has eased after disappointing US inflation data. At 0635 AEST on Monday, the Australian dollar was worth 78.89 US cents, up from 78.58 US cents on Friday.

Westpac’s Imre Speizer said disappointing US inflation report helped push the greenback down.

The US consumer price index (CPI) disappointed for the fifth consecutive month, with its core measure at 0.1 per cent, versus an expected 0.2 per cent, leaving the annual rate at 1.7 per cent, against the expected 1.8 per cent. “The US dollar index closed down 0.4 per cent … (while the) AUD rose from 0,7844,” he said in a morning note.

He said Reserve Bank of Australia Assistant Governor (Financial Markets) Chris Kent speech at the Moody’s Analytics Forum in Sydney would be the key local even risk for the dollar on Monday.

He said he expected to see the Australian dollar “consolidating in the high 0.78s” during the day.

The local currency is also higher against the yen but lower against the euro.


One Australian dollar buys:

* 78.89 US cents, from 78.58 on Friday

* 86.135 Japanese yen, from 85.7885 yen

* 66.76 euro cents, from 66.84 euro cents

(*Currency closes taken at 1700 AEST previous local session)

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