Dollar recovers lost ground; Aussie slips after RBA holds rates
By Rae Wee
SINGAPORE (Reuters) -The U.S. dollar regained some ground on Tuesday and hovered near a one-week high against a basket of currencies, while the Australian dollar fell after its central bank left interest rates unchanged.
The Aussie was last down 0.66% to $0.6576 after the Reserve Bank of Australia (RBA) kept rates at a 12-year high of 4.35% on Tuesday, as expected, and noted that economic data received since November had been broadly in line with expectations.
That left the Antipodean currency some distance away from Monday's four-month top of $0.6690, which it hit on the back of the dollar's decline over the past few sessions.
«The Aussie has had a great run in recent weeks and was arguably overbought over the near-term,» said Matt Simpson, senior market analyst at City Index.
«So we may be seeing a combination of profit taking following the fact of the RBA's hold, and the closure of pre-emptive bets that the RBA may have delivered a more hawkish statement.»
The decline in the Aussie also dragged the New Zealand dollar slightly lower, with the kiwi last down 0.35% to $0.6146.
Elsewhere, the greenback held broadly steady and pushed away from Monday's three-month low against the yen. The dollar last traded at 147.10 yen, helped by a slowdown in core consumer inflation in Tokyo that put downward pressure on the Japanese currency.
The euro, meanwhile, languished near a three-week low hit on Monday and last traded $1.0842, while the dollar index stood near a more than one-week high and was last at 103.60.
Sterling was little changed at $1.26345, some distance away from its recent three-month high.
Analysts say the greenback's move higher was in part due to a reversal of its heavy selloff in recent weeks, which saw
Read more on investing.com
