Strong commodity prices and doubts over the UK economy allow the aussie to gain further ground

The Australian dollar continued to push higher yesterday, advancing over a cent as sentiment towards the higher-yielding currency remained positive.

  • Commodity currencies, such as the aussie, made progress yesterday in line with stronger prices for oil and metals.
  • Rallying global equity and commodity markets encouraged the rise in risk appetite in the market, which heightened demand for the aussie dollar.
  • In the UK, the market still holds the view that further quantitative easing could be announced in November, which has put substantial pressure on the UK currency as other major economies look to wind up stimulus measures.
  • In trading this morning, the pound has halted its steep decline, with the price currently flat as a weaker-than-expected business confidence survey stemmed demand for aussie assets.