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Forex - Dollar Little Changed, Aussie Dollar Inches Up Ahead of RBA Decision

Published 09/28/2018, 01:45 AM
Updated 09/28/2018, 01:45 AM
© Reuters. The U.S. dollar was little changed on Friday - The U.S. dollar was little changed on Friday, while the Aussie dollar edged up ahead of the October’s monetary policy decision from the Reserve Bank of Australia due next week.

The U.S. dollar index which tracks the greenback against a basket of its peers was trading at 94.60, down 0.01% by 1:30AM ET (05:30 GMT), following its overnight rally on the back of economic policy uncertainty in Italy.

"Throughout most of the overnight trading session, there were growing doubts Italy's coalition government would manage to timely agree on a 2019 budget target," Elias Haddad, senior currency strategist at Commonwealth Bank of Australia, said in a morning note.

Official government data showed on Thursday that U.S. gross domestic product grew at a 4.2% in the second quarter, the fastest in nearly four years. Separately, another report showed durable goods rose 4.5% in August.

"The broad rally by the dollar has also been helped by seasonal factors, as it has coincided with U.S. investors bringing funds back home for the month's end," said Yukio Ishizuki, senior forex strategist at Daiwa Securities in Tokyo.

"The dollar looks well placed to gain particularly against the yen, with the U.S.-Japan summit over for now and with interest rate differentials between the two countries continuing to widen."

Meanwhile, the USD/CNY pair last traded at 6.8849, down 0.09%, as the People's Bank of China (PBOC) set the yuan reference rate at 6.8792 vs the previous day's fix of 6.8642.

The Aussie dollar rose 0.1% against the dollar as traders awaited October’s monetary policy decision from the Reserve Bank of Australia due next Tuesday. Retail sales data and PMI are also due next week.

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