The Australian dollar is back under 80 US cents as the downward movement in the US dollar seems to have stopped and weaker metals prices offered no help.

At 0635 AEDT on Monday, the Australian dollar was worth 79.14 US cents, down from 80.01 US cents on Friday.

Analysts at Brown Brothers Harriman said the US dollar index had risen for the first week since the weekend ending December 15.

“The 0.15 per cent gain is nothing to write home about but the sharp downside momentum has been arrested,” they said in a morning note.

“The US dollar turned in its best week so far in 2018…”

Meanwhile, the local currency had put in a respectable performance, despite its decline from Friday.

“The Australian dollar ends its seven-week with aplomb.

“It lost more than two per cent against the (US) dollar for its biggest weekly fall since mid-November.

“We had seen the Aussie as among the most vulnerable to a turn in the US dollar, and often see it leading the other major currencies.

“It had broken down even before the US jobs data, which pushed it lower still, and the other majors joined the move. The Aussie has lost its interest rate support. First, it was the US two-year yield that rose above its Australian counterpart. Then it was the five-year, and before the weekend, the US 10-year yield traded above Australia’s 10-year yield.

“Weaker metals prices and the general risk-off move did the Aussie no favours.”

The Aussie dollar is also lower against the yen and the euro.

AAP

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