After speculation last week by financial press that the AUD might be falling to 90 cents levels, the Australian dollar responded by rising to its highest level in 11 days, currently 103.4. One financial report linked the rise of the AUD to news of the formation of a new government in Italy, which has been interpreted by some that the EU is on the path to recovery. It seems last week’s news that the unemployment rate in Spain hit 27.2% has quickly been forgotten.
**** LME Metals Up, Gains Likely To Be Steady -Newedge ****
1232 GMT [April 30 Dow Jones] Base metals find a direction, edging higher on the day as US trading comes onboard. A weak dollar is lifting the appeal of the dollar-denominated complex to other currency holders as analysts say some investors have interpreted last week’s weaker-than-expected US GDP reading as likely to see the Fed reiterate quantitative easing this week. “Base metals are regaining some semblance of composure after less than inspiring closes on Friday,” notes Michael Turek at Newedge. “The fragility of rallies was certainly evident in the latter part of last week. With both China and Japan on holiday advances are likely to be steady rather than spectacular,” he adds.