WITH the US dollar plunging against a range of currencies, the Australian currency finished a strong week surging above US87c. The US dollar fell after the US Federal Reserve cut a key interest rate by half a percentage point on Tuesday. And US Treasury yields pushed higher late in the week amid concerns the rate cuts could trigger a rise in inflation. And the falling US dollar threatens to exacerbate the risks to inflation," ABN Amro’s director of foreign exchange strategy, Greg Gibbs, said. Mr Gibbs said rising yields in the US would undermine the Fed’s effort to prevent the economy falling into recession, prompting inflation risks and trouble for stockmarkets. And on the trade-weighted index – a gauge of the dollar’s strength against the currencies of Australia’s main trading partners – the dollar climbed five points to 69. read more
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