$A higher despite fiscal cliff negativity
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SYDNEY, Dec 3 AAP
December 03 2012, 07:21AM
The Australian dollar is slightly higher despite ongoing concerns about the fiscal cliff in the United States, due to approval for the latest instalment in aid for Greece.
At 0700 AEDT on Monday, the currency was trading at 104.37 US cents, up from 104.33 US cents on Friday afternoon.
Westpac New Zealand senior market strategist Imre Speizer said the Aussie dollar had risen over the weekend after Germany's parliament approved a 44 billion euro ($A55.18 billion) bailout for Greece.
But he said concerns about the US fiscal cliff - tax rises and spending cuts due to be implemented from early 2013 - had restricted the gains.
"The biggest factor is the US fiscal cliff, which is restraining any upside moves," he said.
"I expect a further rise, perhaps to between 104.50 US cents to 104.80 cents - but that would be the extent of any increase."
Over the weekend, US house leader John Boehner said talks to resolve the fiscal cliff issue were going nowhere.
Mr Speizer said the release of local retail trade data and a Chinese purchasing managers' index (PMI) numbers would influence the dollar on Monday.
However, until the fiscal cliff is resolved the local currency would have little impetus to move higher, he said.
"It will be a permanent negative for the next 30 days," Mr Speizer said.
"The positive factors will have to push harder to lift the Aussie higher."