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Hail Storms destroy Melbourne but the Dollar Remains Strong

March 8, 2010 10:05 by Admin

The Australian Dollar commenced this week with a more positive tone, after the rate had seen pressure last week due to Chinese restrictions on commercial banks extending credit for local governments. Last week the dollar rose to its highest in a decade against the New Zealand dollar on Wednesday hitting $1.31 but finished the week lower after quiet trading. Markets analyst David Taylor put it down to better-than-expected gross domestic product data, which showed Australia's economy grew by 0.9 per cent in the December quarter for an annual rate of 2.7 per cent. "This combined with higher rates on the sound profit reporting season and you've got the right mix for the Aussie," he said. "Over in New Zealand on the other hand, they will probably be looking to keep rates at 2.5 per cent, with the economy still struggling to gain any significant momentum."

Freak hail storms caused mass destruction across Melbourne and parts of Victoria over the weekend as the insurance industry braces itself for 40,000.00 claims to home and car damage. The claim damage is expected to reach into hundreds of millions of dollars and the Insurance Council of Australia (ICA) declared the storm a catastrophe. Large hail stones crashed into cars and houses during the freak 1 hour storm on Saturday, smashing windscreens and roofs were torn from houses. Home and vehicle insurer RACV said “It’s too early to put a dollar value on the damage but it would be considerably high”

The Dollar is expected to remain strong this week after the positive tone set by the US jobless figures on Friday. US labour department figures showed fewer people had been laid off in February which will support a stronger global economy and strengthen the Australian Dollar. On Thursday China release their Producer and Consumer Price indices, retail sales data and industrial production figures for the year. Although market analysts are expecting positive results in all reports this could upset trading and scare off foreign investors.

Last week the Dollar finished on 1.11 against the US Dollar, 1.67 against the Pound and 0.76 against the New Zealand Dollar.

Composed by Leon Redelinghuys
: Note: The above exchange rates are based on "interbank" rates.
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September 9. 2010 08:18

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