The Australian dollar has bounced well above 70 US cents following Malcolm Turnbull’s victory of the Liberal Party leadership.

At 10:35AM (AEST), the dollar was buying 71.6 US cents, its highest level since 28 August. However, by 12:30 it had fallen to 71.3 US cents.

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But while currency traders responded well to Malcolm Turnbull’s defeat of Tony Abbott, equity markets were less upbeat.

After a small jump, the ASX 200 fell about 65 points to 5038 at 12:50AM (AEST).

So far, businesses have responded favourably to the leadership change. The Australian Financial Review reported Citigroup economists as saying the Mr Turnbull’s premiership would be positive for the economy.

“The market had lost faith in Joe Hockey following poorly received budgets and a perceived inability to ‘read’ the economy, in our view,” the economists said in a note to clients.

“Malcolm Turnbull’s narrative of engaging in informed economic debate rather than catch phrases provides some hope that previously forgotten inquiries into areas that could increase economic growth, productivity and supply side reform could now receive more attention.”

This, they said, would be a “positive” for consumer sentiment.

Businessman Dick Smith, Flight Centre CEO Graham Turner and company director James Mackenzie also welcomed the change.