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SYDNEY : Australia's central bank said on Friday it had stepped in to support the Aussie dollar after an overnight sell-off saw a steep drop against the greenback.
The Reserve Bank of Australia (RBA), which has intervened intermittently since late October, made its move after the Aussie dropped almost 3 US cents to 60.80 US cents following a close of 63.52 US cents Thursday.
"We provided liquidity as on previous occasions," a spokesman for the bank told national news agency AAP.
"We don't disclose when, nor do we disclose the level."
The currency traded between 60.78 US cents and 62.40 US cents Friday, after the Dow Jones Industrial Average sank to a fresh five-and-a-half year low, losing 444.99 points or 5.56 percent to end at 7,552.29.
The Aussie was trading at 62.14 US cents at 5:00 pm (0600 GMT) as share markets in Australia and Asia rebounded.
"It's more of the same, the currency market is following the equity market and when the London and New York markets open I'd expect that to continue," Commonwealth Bank of Australia currency strategist Joseph Capurso told Dow Jones Newswires.
The Aussie has dropped dramatically since reaching near parity with the US dollar in July as the global financial crisis has resulted in share market volatility, commodity price falls and sharply lower domestic interest rates.
The RBA said Thursday it had bought a record 3.15 billion Australian dollars in currency markets in October -- a month in which the Aussie fell to a five-and-a-half year low of 60.12 US cents.
It was the first time since September 2001 that the bank has bought more Australian dollars than it had sold.
The fall in the currency comes as analysts are bracing for a further interest rate cut by the RBA on December 2.
The central bank has slashed 200 basis points from its official cash rate since September, with the rate now sitting at 5.25 percent.
At close of trade Friday, the Australian dollar was worth 58.87 Japanese yen, down from the previous day's close of 60.50 yen, and 49.65 euro cents, off Thursday's 50.81 euro cents.
- AFP/ir
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