The pound to Australian dollar exchange rate is 0.392% higher on the day with 1 GBP = 1.5482 AUD at 12 PM in London.
The euro to Australian dollar exchange rate is 1.060% higher with 1 EUR = 1.3512 AUD.
The Australian dollar to US dollar exchange rate is 0.197% lower with 1 AUD = 1.0659 USD.
Analysts at Barclays Capital have warned today that the risks to the Australian dollar exchange rate are skewed to the upside.
"In an environment where the global policy setting remains relatively accommodative, especially when it is being driven by the FOMC, the risks to AUD/USD are biased to the upside," says the exchange rate note.
The path for the AUD over the coming six months will depend on the extent to which the policy tightening in other centres offsets the very accommodative policy being maintained by the FOMC.
There are two-way risks for the currency say Barclays:
"Upside: a persistently dovish FOMC raises the risk that global monetary conditions remain overly accommodative, despite the tightening occurring elsewhere, which would lead to higher commodity prices and global inflation. In this environment, investors would buy the AUD on commodity price strength, as a hedge against inflation and on the likelihood that the RBA would be raising rates significantly further.
"Downside: the Chinese economy is the most significant downside risk to the AUD. If the policy tightening that has taken place so far were to slow the economy more than we expect or if further policy tightening were required to get inflation under control despite slower growth, then many of the above AUD-positive factors would reverse and the depreciation of the AUD would be very quick. While the probability of these scenarios has risen in recent months, they are not our core scenario."
