THE dollar opened lower today as investor appetite for risk was stymied by debates over financial reform in the US.
At 7am AEST today, the dollar was trading at $US0.8667/69, down from yesterday's close of $US0.8727/29.
From5pm AEST yesterday, the local unit traded between $US0.8740 and $US0.8640.
HiFX trading director Mike Hollows said investors backed away from US stock markets overnight (AEST) as congressional debate over financial reform entered its final phase.
"The focus is on the financial markets reform going through," Mr Hollows said.
"The Aussie was dragged off its highs in the last couple of hours with equity markets in the US having a bit of a tumble."
Debate over financial reform among US lawmakers entered its final phase last night with the introduction of new capital requirements giving big banks five years to stop treating trust-preferred securities as Tier 1 capital.
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Tier 1 capital is a measure of a bank's strength.
By the close of the US session, the Dow Jones Industrial Average had slid 1.41 per cent to 10,152.80 points, while the broad-market S&P 500 index had lost 1.68 per cent at 1073.69 points.
"There's been a little bit of risk coming out of the market and the Aussie is suffering there," Mr Hollows said.
With no domestic data due during Friday's session, Mr Hollows said the unit could trade in a range between $US0.8640 and $US0.87.
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