Dollar holds the line

The Australian dollar has retained some of its gains following the Reserve Bank's decision to keep the cash rate on hold, as economists pared back expectations of another interest rate cut.

The Australian dollar has retained some of its gains following the Reserve Bank's decision to keep the cash rate on hold, as economists pared back expectations of another interest rate cut.

The dollar traded as high as US94.35 cents overnight before slipping slightly following weaker-than-expected building approval figures on Wednesday. It was buying US93.52 cents in late trade.

NAB economists joined ANZ in pushing back their expectations of another cut to the cash rate to February 2014 from November this year. The economists said while the RBA appeared to be comfortably on hold, the economy was still expected to underperform in the year ahead, with rising unemployment and weaker-than-expected inflation figures forecast to push the central bank towards another cut in early 2014.