Aussie made strong gains yesterday as further positive economic data supported investor demand

Tuesday’s gains for the pound proved short lived as the aussie advanced over two cents (1.3%) to send the price down to a close of 1.8091.

• The aussie was buoyed by a larger than expected rise in retail sales in Australia, which heightened expectations that the Reserve Bank of Australia would be among the first of the world’s leading central banks to start raising interest rates.
  
• Sales beat forecasts in jumping 0.9% in August from a 0.9% decline in July, which buoyed demand for the high-yielding currency.
  
• Analysts noted that the aussie dollar is being well supported from Australia’s status as a big beneficiary of the solid Chinese economy.
  
• In trading this morning however, sterling has rebounded, currently up half a cent, with traders noting that the aussie is suffering from slight investor profit taking.
  
• Data has also revealed a marginal monthly fall in commodity prices in Australia this morning, which has dulled investor demand slightly.