Aussie dollar punches above 93 US cents

The cash rate futures market has priced in a 95 per cent chance of a 25-basis point interest rate rise on Wednesday.

The RBA raised interest rates by 25-basis points to 6.5 per cent in August.

The Australian dollar performed strongly against its major trading partners, with the RBA's trade weighted index closing at 72.9, up from Wednesday's close of 72.2.

The currency closed at 107.42 yen, up from Wednesday's close of 105.67 yen, and at 64.36 euro cents, up from 63.81 euro cents.

"What that meant was traders basically pushed the probability of an interest rate rise higher," said Eric Sorentino of Global Options in Brussels.

ECB Warning makes US dollar steady against euro

If not for the inflation warning made by the the European Central bank, US dollar would not be steadied at its rates against Euro.Is it really the reason?


The single European currency got a boost against the yen after ECB President Jean-Claude Trichet warned of strong upward pressure on inflation and said some central bankers had wanted a rate increase from the current 4.0 percent.

The yen slipped slightly as Asian stocks rose, taking heart from the U.S. government's plan to help some subprime mortgage borrowers that has raised hopes the economy can avoid a recession.

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