Australian dollar shrugs off deficit

The Australian dollar rallied back towards 78 US cents on Thursday after consistent demand from offshore investors lifted it from lows struck after the March trade deficit proved larger than expected. The Aussie was $0.7790/95, rebounding from $0.7772 and compared to $0.7774/77 late here on Wednesday, according to Reuters data. The Aussie gave up overnight highs of 78.12 in early trade and was dragged down by disappointing balance on goods and services data which showed the second highest-ever deficit in March, about 30 percent larger than market expectations.
The seasonally-adjusted deficit hit A$2.67 billion ($2.08 billion) representing a rise of A$434 million on February and just shy of the A$2.75 billion deficit recorded in April 2003.