You are here

Australian dollar rangebound, NZD near 6-week lows

Thursday, March 2, 2017 - 11:09

27674208 - 16_04_2013 - AUSTRALIA NZ DOLLAR.jpg
The Australian dollar stood at US$0.7658, down a slight 0.2 per cent.

[SYDNEY] The Australian dollar held its own on Thursday, despite the greenback hitting a seven-week high elsewhere, as optimism over global growth underpinned equities and commodity prices.

The Australian dollar stood at US$0.7658, down a slight 0.2 per cent.

It traded in a US$0.7605/0.7731 range for all of February, ending the month 0.9 per cent higher even as the US dollar index climbed 1.6 per cent in the period.

The Aussie also took in its stride domestic data showing a smaller-than-expected trade surplus of A$1.3 billion in January.

sentifi.com

Market voices on:

Exports fell 3 per cent while imports rebounded sharply, though the quarterly current account might still edge into the black for the first time since the mid-1970s.

More important were Wednesday's figures showing the economy turned around in the fourth quarter to extend its 25 years of uninterrupted expansion.

Surveys also showed China's factory activity expanded at a fast pace in February, likely underpinning demand from Australia's No 1 trading partner.

"Strong data with the higher-than-expected GDP, along with buoyant China PMI data has lent support to the AUD," said Stephen Innes, senior trader at Oanda.

"Certainly, the AUD should remain firm on the crosses, which are still a favoured way for dealers to express their bullish Australia bias," Mr Innes added.

The Aussie stood near two-week highs on the yen and a 1-1/2 month peak on the pound. It rose to its highest in 7-1/2 months against its New Zealand counterpart .

The New Zealand dollar stood at US$0.7141, not far from a six-week low of US$0.7100 touched as the greenback rose on speculation the US Federal Reserve would lift rates as early as this month.

New York Fed President William Dudley, a permanent voter on the US central bank's open market committee and close ally of chair Janet Yellen, said the case for tightening monetary policy "has become a lot more compelling".

A Reserve Bank of New Zealand speech briefly sent the kiwi as high as US$0.7166, but it quickly retraced to trade around US$0.7141.

Governor Graeme Wheeler said that risks of any future rate changes were evenly balanced but that US Trump's protectionism was a key risk to the local economy.

New Zealand government bonds eased, sending yields three basis points higher at the long end of the curve.

Australian government bond futures were mixed, with the three-year bond contract unchanged at 97.95. The 10-year contract was down half a tick at 97.1650.

REUTERS

Nespresso
Pair your daily business read with the perfect cup of espresso.

Subscribe to The Business Times today to receive your very own Nespresso Inissia coffee machine worth $188.

Find out more at btsub.sg/btdeal

Powered by GET.comGetCom