$A lower on rate cut speculation
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SYDNEY, Nov 21 AAP
November 21 2012, 07:33AM
The Australian dollar is lower following falls on US stock markets and a signal the Reserve Bank of Australia (RBA) may cut the cash rate again in the near future.
At 0700 AEDT on Wednesday, the Australian dollar was trading at 103.74 US cents, down from 104.14 US cents on Tuesday afternoon.
The currency fell overnight as markets reacted to a speech from RBA Governor Glenn Stevens and the release of the minutes from the central bank's November 6 board meeting.
In his speech, Mr Stevens said the RBA had discussed the possibility of cutting the cash rate below its current level of 3.25 per cent at the meeting.
"The board felt that further easing might be required over time," he told the Melbourne audience.
BK Asset Management managing director Kathy Lien said the talk of further rate cuts pushed the Australian dollar lower.
"Basically, north American and European traders interpreted the tone of the minutes and Stevens' speech to mean that the RBA was still open to the idea of further stimulus," she said from New York.
She said falls in US stock markets had also hurt the Australian dollar.
At 0700 AEDT, the Dow Jones Industrial Average was 0.40 per cent lower, while the S&P 500 was down 0.25 per cent.
Ms Lien said markets were waiting to see whether euro-zone finance ministers meeting in Brussels agree to a long-awaited aid payment to debt-laden Greece.
"If we do get a positive outcome, we could see a relief rally in the Aussie dollar, if not we could see further losses.