The Australian Dollar has weakened due to turmoil in the nations ruling political party. Embattled Prime Minister Julia Gillard is fighting for her political life after she accepted demands for a vote of confidence in her leadership.
Simon Crean, the party’s senior lawmaker and the man who led the Labour Party during its time in opposition from 2001 to 2003 told reporters that he had personally demanded Ms.Gillard to hold the vote. The party’s popularity has waned under her leadership with party members saying that its only hope for re-election was to replace her with Crean as the party had lost its way and had no confidence in Gillard’s leadership.
A defiant Ms. Gillard quickly announced on the floor of Parliament that she would hold the ballot at 4:30 p.m. Thursday. In the meantime, she told her colleagues, “take your best shot.”
The favourite candidate to oppose her for the leadership post is former Prime Minister Kevin Rudd who Gillard ousted in a 2010 party coup. Since then Gillard’s popularity has plummeted in the polls since she announced in January, unusually early, that federal elections will be held in September.
Mr. Rudd has insisted that he would not challenge Ms. Gillard for the leadership, but his supporters, including Mr. Crean, seemed confident that Mr. Rudd would be nominated and would prevail in Thursday’s vote. “I wouldn’t be doing this if I did not believe there were the mood and the need for change within the party,” Mr. Crean told reporters when questioned on the internal vote count.
As a result of the political uncertainty the ‘Aussie’ weakened against the US Dollar. Markets are expecting Markets expect ongoing political uncertainty around Julia Gillard’s leadership. The rise in the strength of the Japanese Yen has also put pressure on the Oceanic currency.
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