THE dollar was trading about 0.5c lower at noon, as concerns over Australia's economic recovery continue.
At midday (AEDT) today, the local unit was trading at US98.99c, down from US99.50c yesterday.
Since 7am today, the dollar traded between US98.92c and US99.29c.
ICAP senior economist Adam Carr said the Federal Government's flood levy would only have a small economic impact and the dollar was more likely being affected by national economic uncertainty.
"There's a bit of confusion as to where we are regarding the global economic and domestic economic recovery," he said.
"If you look in Australia, we've had a low CPI (consumer price index), so that would tend to indicate that the Reserve Bank of Australia is going to keep rates lower for longer, but at the same time global growth's booming."
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Mr Carr said this confusion was being reflected in the dollar as it "swings around wildly".
"Until we get a little bit more certainty on the domestic and global growth outlook we'll still see a lot more volatility," he said.
Mr Carr said he expected the local unit would move up over US99c once the European session gets underway and would stay at this level until fourth quarter US GDP figures were released overnight (AEDT).
Meanwhile, the Australian bond market was firmer at noon.
At midday on the ASX 24, the March 10-year bond futures contract price was at 94.485 (implying a yield of 5.515 per cent), up from yesterday's close of 94.450 (5.550 per cent).
The March three-year bond futures contract price was at 94.930 (5.070 per cent), up from 94.900 (5.100 per cent).
Dollar lower at noon, bonds firm on CPIFed’s hand strengthens on tame inflation data
