THE Australian dollar closed at a seven-month high yesterday after US policymakers signalled a further purchase of American government debt, which led to a weaker US dollar.
At the local close, the dollar was trading at US77.53c, up from Wednesday's close of US77.11c.
During yesterday's local session, the dollar moved between a low of US77.71c and high of US78.09c, the first time it has reached US78c since October 2.
And it opened the session at US77.55c, its highest start since that date.
HiFX senior consultant Derek Mumford said the Australian currency had been bolstered by positive investor sentiment after the US dollar weakened during Wednesday's offshore session.
The safe-haven US currency faltered after the US Federal Open Market Committee issued the minutes of its April 28-29 board meeting.
The minutes showed some Federal Reserve policymakers had said extra purchases of US government debt "might well be warranted at some point to spur a more rapid pace of recovery".
In a bid to revive the US economy, the FOMC decided at its March meeting to start buying up to $US300 billion ($387.7 billion) of government debt over the next six months.
Mr Mumford said the Australian dollar had "been leading the way as far as US dollar selling is concerned", but added he thought it was due for "some profit-taking and consolidation".
At yesterday's close, the Australian dollar was trading at 73.42 yen, down from Wednesday's close of Y73.83, and at 56.25 euro cents, down from 56.64 euro cents.
The euro finished at $US1.3780, up from Wednesday's close of $US1.3612, and at Y130.50, up from Y130.32.
The US dollar finished at Y94.71, down from Y95.74.
The 90-day bank bill rate closed at 3.135 per cent, up from Wednesday's close of 3.135 per cent, and the 180-day bank bill rate was at 3.150 per cent, up from 3.150 per cent.
