Aussie dollar tumbles to a one-month low on Thursday as the federal government releases its latest economic outlook.
But it remains relatively stable at $US1.2877, according to Reuters data.
The Reserve Bank of Australia has cut its forecast for economic growth this year to just 1.6 per cent from 3.6% in September.
The central bank is also keeping its inflation target unchanged at a range of 1.2 to 1.5 per cent.
It is now predicting growth in the first quarter will be 2.4 per cent, compared to 2.9 per cent in August.
While the Australian dollar has recovered some ground from its August slide, the Bank of England has also slashed its inflation forecast to 2 per cent to 5 per cent as it looks to maintain its economic recovery.
However, with inflation expectations still at 1.3 per cent and forecasts of GDP growth of 1 per cent next year, the pound is still trading in negative territory against the euro and the dollar.