The Australian dollar advanced past 90 US cents on Wednesday as firmer regional stock markets encouraged investors to return to riskier positions in high-yielding currencies.
Asian stocks tracked big gains on Wall Street, where the market benefited from favourable comments by Goldman Sachs on asset writedowns and from a surprisingly strong retail sales report from Wal-Mart Stores Inc. Domestic data also lent the Aussie a hand. Australia's third-quarter wage price index rose 1.0 percent quarter-on-quarter and 4.2 percent on a year earlier.
"The Aussie should be in a position to rise above 90 US cents but there will be a lot of wobbles on the way, given risk aversion is still a dominant theme." The Australian dollar was at $0.9022/25, up 1.5 percent from $0.8891/96 on Tuesday, and pulling further away from $0.8757, its lowest since October 22, struck the previous day. Still the Aussie remained well below a near 24-year high of $0.9401 hit last week.