Forex Pros – The Australian dollar fell to a four-day low against its U.S. counterpart on Wednesday, after data showed that while Australia’s economic growth accelerated in the fourth quarter, concerns about the impact of massive floods in the nations north-east remained.
AUD/USD hit 1.0086 during late Asian trade, the pair’s lowest since February 24; the pair subsequently consolidated at 1.0099, shedding 0.32%.
The pair was likely to find support at 1.0000, the low of February 24 and resistance at 1.0177, the high of February 25.
The Australian Bureau of Statistics said gross domestic product advanced 0.7% from the third quarter, when it rose a revised 0.1%, slightly more than the forecast 0.6% gain.
While the report was mostly strong, concerns about the future impact of the devastating floods that devastated the coal-rich state of Queensland in December and January hung over the report.
Australia’s Treasurer Wayne Swan said he estimated that the flooding had cut 0.4% from growth in the last quarter and said the first three months of this year “will be a very difficult quarter and reflect the impact of floods and cyclones.”
Also weighing on sentiment were remarks by New Zealand’s Prime Minister, John Key, who said he expected an interest rate cut from the Reserve Bank of New Zealand in response to last week’s earthquake in Christchurch.
The Aussie was also down against the euro, with EUR/AUD rising 0.22% to hit 1.3624.
Later Wednesday, Ben Bernanke was to testify for a second day before the Senate Banking Committee, while the Fed was to publish its Beige Book. The U.S. was also to publish data on private sector payrolls compiled by payroll processing firm ADP.
ForexPros.com
