The Australian dollar was higher today as a stronger-than-expected profit result for US aluminium giant Alcoa offset a dip in domestic business confidence.
At noon east-coast time, the Australian dollar was trading at 87.62 US cents, up 0.49 per cent from yesterday's close of 87.19 US cents.
It was also buying 77.75 yen, 69.51 euro cents and 58.24 pence.
Since 7am, the local unit traded between 87.41 and 87.8 US cents.
Senior dealer with online currency trader EasyForex, Francisco Solar, said the Australian dollar received a boost following the release of Alcoa’s second-quarter earnings report after the close of trade in New York.
The aluminium producer reported a net profit of $136 million in the June quarter, a turnaround from a loss of $454 million in the corresponding period in 2009.
The manufacturer is the first of major companies to begin the second quarter reporting season in the US, where investors are cautious about the profitability of American companies.
Equity markets in Asia were higher, with Japan’s Nikkei-225 index up 0.36 per cent.
‘‘In the absence of anything relevant with regards to the economic growth worldwide, the Alcoa results gave a little boost to the Aussie and that has been something the market has been waiting for,’’ Mr Solar said.
‘‘Alcoa was a good result and that has pushed the Aussie higher.’’
Mr Solar said the currency kept the gains for most of the morning trade until the release of the National Australia Bank’s business confidence survey for June at 11.30am.
The NAB’s survey of business confidence index fell one point to plus four points in June, staying below its long-run average of plus seven points.
The index of business conditions rose two points to eight index points in June, the NAB report released said.
‘The fact that the index fell from five to four gave a bit of an excuse to pullback the Aussie somewhat,’’ Mr Solar said.
For the rest of the Asian session, he forecast the Australian dollar to trade between 87 and 88.1 US cents.
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