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$A higher as US delays attack on Syria

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Published on: Monday, September 02, 2013

The Australian dollar is higher as the market shows its relief that the US won't launch an attack on Syria for at least a week.

At 1200 AEST on Monday, the local unit was trading at 89.63 US cents, up from 89.54 cents on Friday.

LTG GoldRock director Andrew Barnett said the delay in any attack had helped most currencies recover losses made last week.

"Because Obama said on the weekend he would wait for a Congressional vote on this, we've seen money come to risk currencies like the Aussie dollar and it's gone up this morning," he said.

"So, the market has realised there is not going to be a strike for at least a week, until after the G20 summit, and the Aussie dollar has benefited from that.

"I personally think that until there is a strike, the US dollar is going to find some strength against the yen and the Swiss franc, and the Aussie is going to be a benefactor."

It is a very busy week for Australian markets, with economic data out every day, as well as a central bank board meeting on Tuesday.

Mr Barnett said the highlight would be the Reserve Bank of Australia's interest rate decision on Tuesday and the June quarter gross domestic product figures on Wednesday.

"I'm a buyer of the US dollar but other currencies such the Aussie and the kiwi are going to be volatile for the rest of this week based on the data each day," he said.

On Friday, the US will release its August employment figures, the last data before the US Federal Reserve's policy meeting on September 17-18, when it's expected to make a decision on the tapering of its massive economic stimulus program.

Meanwhile, Australian bond futures prices were lower at noon.

At 1200 AEST on Monday, the September 10-year bond futures contract was trading at 96.045 (implying a yield of 3.955 per cent), down from 96.100 (3.900 per cent) on Friday.

The September three-year bond futures contract was at 97.200 (2.800 per cent), down from 97.240 (2.760 per cent).


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