Canberra - AFP
The Australian dollar on Tuesday edged above parity with the greenback for the first time since September 22 after Germany and France pledged to come up with a plan to shore up Europe's banks. The "Aussie" hit an overnight high of 100.15 US cents and was trading at 99.96 US cents by 2150 GMT. The risk-based currency first breached parity in October last year and has rallied consistently near or above the US$1.00 mark, hitting a record of 110.81 US cents in July. It retreated briefly in the immediate aftermath of Japan's quake and nuclear crisis before again dropping below US$1.00 on August 9 following Standard & Poor's downgrade of the United States. The September fall below parity came after the US Federal Open Market Committee announced plans to shift US$400 billion in its shorter-term debt portfolio holdings to longer-term bonds. It had remained there since but was boosted by German Chancellor Angela Merkel and French President Nicolas Sarkozy promising a "lasting, global and quick responses before the end of the month" to the eurozone debt crisis. GFT Forex director of currency research Kathy Lien said the commitment by the eurozone's two biggest national economies to stabilising banks had given the market a sense of optimism. "Little details were provided from Merkel and Sarkozy but as the two main stumbling blocks to any major bailout package for the eurozone, their co-operation has been warmly received by the markets," she told reporters