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SYDNEY - The Australian dollar jumped overnight to open higher ahead of today's domestic inflation figures as the US dollar fell on speculation of a sell-off in Europe.
At 0700 AEDT, the domestic currency was at US$0.7923/26, up from yesterday's close of 0.7885/90.
Overnight, it reached a low
of US$0.7873 and a high of 0.7937.
ICAP head of economics and strategy Michael Thomas said the Australian dollar had strengthened as a result of general US dollar weakness in response to talk of a sell-off in Europe.
"Most currencies are up against the dollar overnight," he said.
"There were rumours of Eastern European central banks buying euros against the US dollar."
Commodities also performed well during the overnight session, with higher prices continuing to lend underlying support to the local currency.
But despite the Australian dollar's strong performance, Mr Thomas said he believed the risks for the currency lay to the downside.
He said there was a good chance that today's highly anticipated consumer price index (CPI) would come in a little below expectations, reducing the chance of an interest rate rise and prompting some selling in the local dollar.
Economists expect headline inflation to rise 0.2 per cent in the December quarter for an annual rate of 3.6 per cent, while weighted median measure of underlying inflation is predicted to rise 0.7 per cent for an annual pace of 3.2 per cent.
"The PPI (producer price index) numbers out on Monday came in a bit lower than expected across the board and that sort of gives a bit of hope that the CPI will come in on the low side too," he said.
The Australian Bureau of Statistics (ABS) will release the headline CPI at AEDT 1130, with the Reserve Bank of Australia's underlying measures following shortly an though as many as 27 per cent may suffer from it. Doctors believe that treating the depression may also slow the deterioration of their patients' health.
The Canadian study, published in this week's Journal of the American Medical Association, involved 284 patients variously given the drug citalopram -- sold as Celexa by Forest Laboratories Inc. -- a placebo or short-term psychotherapy.
The patients had previously suffered a heart attack or major blockage of arteries.
Citalopram is one of a class of antidepressants taken by millions, commonly called SSRIs, that include Eli Lilly's Prozac.
The study found that the drug worked to combat depression by easing its most common symptoms, with the effect apparent within six weeks.
But, it concluded, counselling did not have an impact.
"It remains to be demonstrated that any form of psychotherapy is superior to clinical management in reducing depression symptoms in this group," it said.
In an editorial in the same issue commenting on the study, physicians Alexander Glassman and J. Thomas Bigger of the New York State Psychiatric Institute said the study provides further evidence that SSRIs combat depression in heart disease victims.
And while there is suggestive evidence that such drugs help reduce the risk of a subsequent heart attack and other problems it will take a large study to find that out, a project which they said is "urgently needed."
- REUTERS