Home > Dollar plummets to 90 cents this morning

Dollar plummets to 90 cents this morning

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The Australian dollar hit a six month low this morning, only narrowly staying above $US 90c, with slowing Chinese factory output and the US dollar’s increased strength two major reasons for the slide.

Business Spectator reports that the dollar fell to $US 90.14c at 7:15 am this morning.

It notes that consumer confidence and retail figures in the US are increasing the likelihood that US interest rates will rise shortly.

Over the weekend, figures were released showing Chinese factory output rose only 6.9 per cent, year-on-year – far below a predicted 8.8 per cent.

"Short of outright policy easing, China will likely miss the 7.5 per cent growth target this year, and a sharp economic slowdown will also endanger the undergoing structural reforms," Fairfax reports the ANZ’s chief China economist Li-Gang Liu as saying

Lower Chinese demand has helped lower prices for iron ore and other commodities. Last week the price for iron ore, Australia’s leading export, hit a five-year low.

Bank of America Merrill Lynch predicts the Australian dollar will be the worst performing currency among developing nations, and is tipped to be worth about $US 80c at the end of next year, Business Spectator notes.

Image: http://www.news.com.au/

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