Interpac Business and Migration Solutions Melbourne Australia

（January 27,2012）

THE AUSSIE dollar has retreated slightly from a three-month high after a reassessment of global economic prospects by the currency market.

The local currency traded as high as 106.86 early on Friday morning, its highest since October 31, boosted by strong performances on equity markets.

At 17.00 (AEDT) the Australian dollar was trading at 106.11 US cents, down from 106.36 cents on Thursday afternoon.

Commonwealth Bank currency strategist Joseph Capurso said the local currency had the potential to wind down even further, depending on upcoming US data.

"It's hard to see the Aussie dollar moving much in the next couple of hours but there are a couple of big events happening tonight, including the US GDP (global domestic product)," he said.

"That has, I think, the risk of disappointing the market, and that would probably push the Aussie down a bit because it would again raise questions about the state of the global economy.

"The Aussie dollar is broadly seen as a barometer of the global economy, so we could see a drift downwards similar to what we've seen today."

The US Federal Reserve has indicated that it planned to keep rates low until 2014, and the Reserve Bank of Australia (RBA) is set to make its own rates decision in early February.

Mr Capurso said the market would not be likely to move much in response to the RBA rate decision itself, although its explanation for a cut could have an effect on the direction of the local currency.

"The market's got about an 80 per cent chance of a rate cut, so if the (central) bank does deliver, it still shouldn't move the Aussie much," he said.

"But if they start to sound more concerned about our domestic economy or about (banking industry) funding costs in their statement, then that could soften the currency on the day at least."
（sourc：theaustralian）