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Uncertain election result brings down Australian Dollar

The Australian dollar is lower after a stunning federal election cliffhanger put the prospect of another hung parliament on the cards.

Australian currency

Source: AAP

At 0700 AEST on Monday, the local unit was trading at 74.48 US cents, down from 74.56 cents on Friday.

The nation's political future remains in limbo and Westpac strategist Imre Speizer says the fate of Prime Minister Malcolm Turnbull's government may not be known for days following Saturday's inconclusive poll result.

"Counting will begin again on Tuesday after all absentee, interstate, postal and other declaration votes are reconciled, sorted and packaged," he said.

"The possibility of a hung parliament - with possible ratings outlook implications - suggests that the Australian dollar should trade on the back foot."

He tipped the Reserve Bank to reinstate an easing bias while leaving rates on hold on Tuesday, due to uncertainty triggered by Britain's vote to leave the European Union and a deteriorating global economic outlook.

This should also weigh on the Aussie, Mr Speizer said.

CURRENCY SNAPSHOT AT 0700 AEST ON MONDAY

One Australian dollar buys:

*50.17 Indian Rupees, from 50.39 Rupees on Friday

* 74.48 US cents, from 74.56 cents

* 76.43 Japanese yen, from 76.60 yen

* 66.90 euro cents, from 67.24 euro cents

* 103.98 New Zealand cents, from 104.35 NZ cents

* 56.21 British pence, from 56.09 pence

Government bond yields:

* CGS 5.25pct March 2019, 1.528pct, from 1.528pct

* CGS 4.25pct April 2026, 1.954pct, from 1.955pct

Sydney Futures Exchange prices:

* September 2016 10-year bond futures contract, was at 98.025

(implying a yield 1.975 per cent), down from 98.040 (1.960 per

cent) on Friday

* September 2016 3-year bond futures contract, at 98.510 (1.490

per cent), down from 98.530 (1.470 per cent)

(*Currency closes taken at 1700 AEST previous local session,

bond market closes taken at 1630 AEST previous local session)

Source: IRESS


2 min read

Published

By Shamsher Kainth

Source: AAP


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