Dollar drops below 90c; Westpac expects pick-up in business lending: Midday Roundup

The Australian dollar has fallen below 90 US cents this morning, currently trading at 89.26 US cents, according to OzForex.

Just as the dollar dropped, it was revealed this morning Reserve Bank governor Glenn Stevens wants it closer to 85 US cents.

In an interview with The Australian Financial Review,Stevens said he would opt for lower dollar over lower interest rates to boost the economy.

“To the extent that we get some more easing in financial conditions, at this point it’s probably more preferable for that to be via a lower currency at the margin than lower interest rates,” he says as quoted by The Australian Financial Review.

Westpac expects pick-up in business lending

Westpac Banking Corporation has signalled it expects a pick-up in lending growth in 2014, as consumer sentiment and business sentiment improves.

Speaking at the bank’s annual general meeting, chairman Lindsay Maxsted said the federal election and the lower Australian dollar has been driving the improvements in market confidence.

“More interest is beginning to emerge from businesses as they think about investing again,” he said.

“This interest has yet to translate to real activity and new lending, but is a welcome sign. These trends support our positive view about the medium-term outlook for the Australian economy.”

Shares fall on open

Aussie shares have dropped on open, on the back of Wall Street loses overnight.

The S&P/ASX200 benchmark was down 13.8 points to 5048.7 at 11.05am AEDT. Last night the Dow Jones closed down 104.1 points, 0.66% lower at 15,739.43.