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The Tipster

Kathleen Brooks
THE Australian dollar has been subdued, which is surprising since strong business confidence data earlier this week increases the chances of more interest rate hikes from the Reserve Bank of Australia. The Aussie dollar has traded on a weaker note since Monday after reaching AU$0.9150 against the greenback. Its weak performance in recent sessions can be explained by a decline in risk appetite, which has put upward pressure on the US dollar, which is considered a safe-haven currency. The main risk to the Aussie dollar this year is measures by the Chinese authorities to temper growth, which could depress resource exports. The current IG Index price on Australian dollar-US dollar is AU$0.9071- AU$0.9073.

The sterling-US dollar exchange rate has dipped below the $1.5000 level for the second time in as many weeks, as fears over a hung parliament continue to spook the markets. Also weighing on the pound was weak housing and trade data, which threatens growth in the first quarter. The last time sterling dipped below this level it bounced back successfully, however a test of the lows can't be ruled out, particularly if the polls show a further narrowing between Labour and the Conservatives in the run up to the general election. Capital Spreads quotes a spot sterling-US dollar price of $1.4950-$1.4952.

The euro continues to come under pressure, especially compared to the Swiss franc. The Swiss central bank tried to intervene to weaken its currency last week, but its ability to continue this policy has been damaged by stronger Swiss economic data. Spreadex offers a spot price on euro-Swiss franc of SFr1.4622- SFr1.4628.