Weak Wall St drives down Aussie dollar

SYDNEY - The Australian dollar opened lower on Thursday as investors offloaded high-yielding currencies and bought the US currency.

At 0700 AEST, the Australian dollar was trading at US$0.9267/70, down slightly from Wednesday's close of US$0.9272/74.

Since 1700 AEST on Wednesday, the local unit has moved between US$0.9249 and US$0.9298.

Equity markets in the US fell on Wednesday amid renewed concerns about the durability of the global economic recovery.

The Dow Jones Industrial Average lost 0.66 per cent, while the broad-market Standard & Poor's 500 index fell 0.59 per cent.

Westpac New Zealand senior market strategist, Imre Speizer, said negative sentiment on financial markets weighed on the Australian dollar, yet the currency held up for most of the offshore session.

"Broadly, risk sentiment was negative last night and US equities were down," he said from Wellington.

"There was no fresh news, just ongoing worries with Greece (about which) the ongoing sentiment reared its head..."

Investors have become more concerned that Greece may not be able to fix its public debt and deficit problems.

The Australian dollar reached 69.53 euro cents during Wednesday's offshore session, its highest level since the introduction of the eurozone currency on January 1, 1999.

Mr Speizer said the Australian and New Zealand dollars received support against the US currency during offshore trade.

"The commodity/China story is hugely bullish for down under, which has all the commodities that China wants," he said.

Financial markets await the release of the labour force report for March from the Australian Bureau of Statistics (ABS) due at 1130 AEST on Thursday, Mr Speizer said.

An AAP survey of 11 economists found a median forecast of total employment rising by 30,000 in Australia during March and the unemployment rate remaining unchanged at 5.3 per cent.

In February, the nation's jobless rate increased 0.1 percentage point to 5.3 per cent while total employment rose by 400 jobs, ABS data showed.

"If you get a weak number, you would get more of a reaction on the downside than you would from a positive number of the same magnitude," Mr Speizer said.

He forecast the local currency to trade between US$0.9200 and US$0.9330 during the Asian session.

CURRENCY TABLE:

CURRENCY SPOT PREVIOUS CLOSE

AUD/USD 0.9267-70 0.9272-74
AUD/JPY 86.47-53 87.11-16
AUD/EUR 0.6941-51 0.6926-32
AUD/NZD 1.3099-09 1.3165-74
AUD/GBP 0.6075-85 0.6079-84
EUR/USD 1.3342-45 1.3376-78
USD/JPY 93.32-35 93.94-97
EUR/JPY 124.51-55 125.68-70

- AAP