Last week was a reasonably successful week for the Australian dollar, with gains of half a US cent and two thirds of a cent against sterling, but that was only enough to keep it in the upper half of the field. There was no chance of it catching the euro, which romped away to a two and three quarter cent gain on the week.

Apart from a larger than expected monthly fall in building permits the Australian ecostats were broadly helpful. The purchasing managers' index for the manufacturing was the strongest in 18 months. Another positive surprise was the 0.9% expansion of gross domestic product reported for the first quarter.

Even the Reserve Bank of Australia inadvertently helped the currency when it left its benchmark interest rate unchanged at 2%. Investors studiously ignored the RBA's observation that "further depreciation seems both likely and necessary".