Despite moderate greenback strength, Gold was the standout performer in overnight trading with the precious rising to highs of US$1153.00 a troy ounce. Recent times have seen the Dollar strength/Gold weakness converse relationship turn the corner with overnight movements looking like a classic case of investors hunting for alternative currency investment.
Negative investor sentiment on the back of the less than convincing consumer credit data, drove US equity markets lower, which in-turn took some steam out the latest Aussie dollar rally. US Consumer Credit contracted $11.5 billion in February well off estimates of a moderate retreat of $0.7 billion.
However strength in Gold overnight kept the Aussie dollar supported throughout the session, flirting with highs of 93 US cents before a moderate retracement to current levels of 92.6 US cents.
Just when we thought Greece’s economic woes were in the rear view mirror, this continued to weigh on investment sentiment which by default saw the Euro continue a downward trajectory. We also saw a less than convincing fourth quarter GDP from the Euro-Zone with the final revision showing no growth against the expected 0.1 per cent, representing an annual contraction of 2.2 per cent.
Locally, Aussie dollar movements will be contingent on this morning’s unemployment data which is expected to show the Australian economy created 20,400 jobs in March against a previous 400 new jobs. At the time of writing the Aussie dollar is buying 92.6 US cents and remains at the mercy of today’s jobs data which could pose considerable downside given a less than convincing result.