Dollar slips on rising oil price

The Australian dollar has closed weaker, as investors assess the effects of rising oil prices on global growth.

At the end of local trade, the dollar was trading at 101.27 US cents, down from Friday’s local close of 101.41 US cents.

CMC Markets foreign exchange dealer Tim Waterer said the unit was under sustained pressure as investors continued to fret about the rising price of oil.

Friday’s price for light sweet crude hit levels not seen since September 2008, closing at $US104.42.

The price has jumped more than 21 per cent over the past two weeks amid turmoil in Libya and increasing international demand.

‘‘Risk appetite remains in the backburner,’’ Mr Waterer said. ‘‘People are thinking about the potential of high oil on growth.

‘‘As a result, riskier assets have fallen out of favour.’’

The local share market closed nearly one-and-a-half per cent lower on Monday.

Mr Waterer said with no market moving data due on Monday night, oil prices would dominate market sentiment.

‘‘Oil will be the focal point this evening,’’ he said.

AAP