Australia’s dollar remained lower following its steepest drop this month after the Reserve Bank cut its gross domestic product forecast for 2014, underscoring the possibility of a further reduction in interest rates.
The Aussie, the most overvalued after the New Zealand dollar among major currencies, hasn’t tracked fundamentals, Reserve Bank of Australia Assistant Governor Guy Debelle said yesterday. It held a weekly advance versus most of its peers before a report that may show imports by China, the nation’s biggest trading partner, rose in October for a fourth month.
“The RBA continues to look for a weaker currency,” said Emma Lawson, the Sydney-based senior currency strategist at National Australia Bank Ltd. “Combine that with the lower GDP forecast and that is likely to weigh on the Aussie.”
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