Related Articles
Share it
A cancellation of a visit by Greek prime minister George Papandreou to the United States and a regional election defeat for Germany’s chancellor Angela Merkel fuelled a move to back into Treasuries today, helping the US dollar broadly appreciate in value.
The aussie dollar was unsurprisingly among the worst-hit currencies today, down 1.06% to $1.0191 this afternoon on the view that a default by Greece would jeopardize the global economic recovery and force the Reserve Bank of Australia (RBA) to slash interest rates. Investors also fear that the minutes of the 6 September meeting will be on the dovish side tomorrow, so nervous investors aren’t taking any chances and are selling ahead of the publication. In the meantime, Credit Suisse AG indices based on swaps show that traders are expecting the RBA to lower interest rates by 1.48 percentage points over the next 12 months.
