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$A up slightly amid Lunar New Year

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AAP

2013-02-11

The Australian dollar is slightly higher following a quiet day of trading, with Asian markets closed due to the Lunar New Year holidays.

At 1700 AEDT on Monday, the currency was trading at 103.01 US cents, up from 102.98 cents on Friday.

ANZ foreign exchange strategist Andrew Salter said it had been a quiet day or trading due to Chinese new year holidays.

Mr Salter said increasing expectations the Reserve Bank of Australia would cut the cash rate at its next board meeting, on March 5, and weaker housing finance data had kept the currency under pressure.

"The Chinese new year has dampened price action across the region and with Japan out for a holiday as well there is very little flow going through the market," he said.

"It looks like the rates market has dragged us down a little bit and the housing finance figures can account for probably half the move, but these are pretty thin conditions so I wouldn't read too much into it."

Australian Bureau of Statistics data on Monday showed the number of home loans taken out in December fell 1.5 per cent, compared to the previous month.

Mr Salter said the currency market would pick up on Tuesday once Japanese markets reopened although Chinese markets would be closed all week.

"We will probably see a bit more vitality in the Aussie dollar tomorrow."