The Australian dollar continues its upside movement versus major currencies, where it strengthened to a new multi decades high versus the greenback, after the RBA Governor hinted that the economy needs to increase the rates by 25 basis points in the upcoming period, to curb inflation appreciation.


Moreover, the Governor said that The Australian currency’s surge to a record won’t slow the economy and contain inflation as money market yields signal Reserve Bank Governor Glenn Stevens will resume raising interest rates.


The Reserve Bank of Australia will increase borrowing costs after a government report showed consumer prices rose 1.6 percent last quarter, the fastest pace since 2006, fueling the demand of the Aussie.


Australian economy Monday at 23:30 GMT (Sunday) will release the AiG performance of manufacturing index for April, while the previous reading came less than 50 at 47.9.


The Australian nation is to present the first quarter house price index at 01:30 GMT that increased by 0.7% in the fourth quarter of 2010. The annualized AUD house price index for the year ended March 31, after the previous reading showed an incline by 5.8%.


On the other hand, the U.S. economy will start the week with the construction spending for March at 14:00 GMT, where it’s expected to show an increase of 0.3% after the previous decline of 1.4%.


Also ISM manufacturing will be released at 14:00 GMT and expected to come at 60.1 compare with the previous of 61.2. 

Originally posted here

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