Aussie stregthens against sterling

The pound lost ground to the Australian dollar on Friday, and continued to fall over the weekend.

• Sterling ’s fall came on the back of improving risk appetite and rising commodity prices, both of which boosted demand for the aussie dollar.
  
• The flow of information from the US, Japan, Europe and the UK continues to suggest that the intensity of the recession is easing.
  
• Oil closed above $US66 a barrel on Friday, up more than 100% from its lows five to six months ago, and copper prices also rose strongly.
  
• Also, another reason for the rise in the Australian dollar is the return of the carry trade: US investors are selling the US dollar to buy the Australian dollar and get returns well above what they can get in the States.