MW:Australian dollar heads to parity on Greek worries
By Sarah Turner, MarketWatch
SYDNEY (MarketWatch) — The Australian dollar fell closer to parity with its U.S counterpart on Wednesday, weighed down by concerns about Greece’s political future.
The Australian dollar traded at $1.0057, down from $1.0125 in late North American trading Tuesday, when it touched a session low of $1.0087.
The Australian dollar hasn’t fallen below parity with the U.S. dollar since mid-December.
The concern in the currency markets is that Greece may “shoot itself in the foot” and run out of money by the end of June, said BNP Paribas currency strategist Robert Ryan.
“The implications for the global financial system are not positive,” he said. “People are looking for excuses to push lower against the backdrop of Greece.”
At the same time, the ICE dollar index, which measures the greenback against a basket of six other currencies, rose to 79.988, up from 79.719 in late trading Tuesday.
The move extended the dollar’s longest string of gains since 2008, as investors sought a safe haven amid worries both about Greece’s potential exit from the euro zone and the health of Spain’s banks.
Greece’s conservative, pro-bailout New Democracy party late Monday failed to form a coalition government in the wake of Sunday’s parliamentary election.
The news weighed on the euro, which fell to $1.2969, down from $1.3014 in late trading Tuesday. The drop surpassed Tuesday’s intraday low of $1.2981.
The British pound traded at $1.6130, down from $1.6158 late Tuesday.
The dollar bought 79.74 Japanese yen, slipping from ÂĄ79.81 in late trading Tuesday.
Sarah Turner is MarketWatch's bureau chief in Sydney.
