AUD/USD Higher on Trade Hopes

In the higher risk asset space, the Aussie Dollar edged higher against the greenback on growing hopes that there will be some progress in the trade discussions between the US and China. The Austrailian Dollar has been hit hard by the rift between the two largest economies, given that its fortunes are highly coorelated to trade decisions and outcomes in China, its largest trading partner for both finished goods and raw materials. On the year, the Aussie has lost about 10% of its value against the Dollar, though it managed to eke out a slight gain going into the year's end.

As reported at 11:37 am (GMT) in London, the AUD/USD was trading at $0.7063, up 0.31%; the pair has ranged from $0.7089 to $0.70712 in today's trading session. The NZD/USD was trading at $0.6712, up 0.03%, while the low for the trading was recorded at $0.67040 and the peak at $0.67222. The USD/JPY was trading at 109.8820 Yen, down 0.3347% and just off the session low, while the peak is a distant 110.475 Yen.

Dollar Subdued on Outlook

On the last day of the trading year, the US Dollar had earlier steadied against most of its rivals but seems to be facing renewed pressure. With the rate outlook from the Federal Reserve Bank now much more subdued with no additional rate increases ahead in the short term, markets expect the US economy to weigh heavily on the Dollar in the months ahead. The growing deficit and the concerns over global growth are likely to continue to negatively impact the greenback, says currency analysts. The USD/EUR was trading at $1.1458, up 0.14% while the GBP/USD was trading at $1.2774, up 0.60%.

Barbara Zigah is a freelance journalist living in Ghana, who specializes in Forex-related content; her online work has appeared in the IB Times, NASDAQ, Benzinga, and Seeking Alpha.