The Australian dollar continues to fall against the US dollar this afternoon amid concerns that Italy risked defaulting on its €1.9 trillion sovereign debt hole, which would in turn have severe consequences for the whole of the eurozone region, and in turn the global economy.

Italy has been under pressure since last week when the government agreed to surveillance from the International Monetary Fund and the EU to ensure the country was meeting crucial targets to cut its massive debt. The recent wave of risk aversion (which surprisingly is not being seen in the equity markets today) has weakened the Australian dollar this afternoon and seen it hit an intraday low of $1.0282. An earlier comment from the ECB’s Juergen Stark provided some relief to risk appetite and as a result to the commodity-based currency. Mr Stark said that the region’s debt crisis will be under control in two years also, which saw AUD/USD briefly touch an intraday high of 1.0397.

In addition to the developments in Europe, investors will also await for official jobs data from Australia on Thursday. The figures are expected to show total employment may have increased by 10,000 in October and the unemployment rate having risen to 5.3% from 5.2% in September.