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Aussie falls again, NZ dollars near one-week lows
[SYDNEY] The Australian dollar was on track to fall for a fourth straight session on Thursday, getting only fleeting support from a higher-than-expected trade surplus, while its New Zealand cousin stood near one-week lows.
The Aussie was pinned at US$0.7594, having slid from a peak of US$0.7712 hit last week.
The currency is likely to have its worst weekly performance since early April. The drag came largely on Tuesday with bulls holding a grudge against the Reserve Bank of Australia (RBA) for sticking to its neutral bias on interest rates.
That overshadowed official data showing Australia's trade surplus rebounded sharply in May, putting exports back on track to add to economic growth in the quarter.
The surplus surged to A$2.47 billion (S$2.60 billion) in May, more than twice market forecasts of A$1.1 billion. The April surplus was revised down to A$90 million.
"The recovery in export volumes - in a quarter average sense - will be spread across Q2 and Q3. We expect real net exports to be broadly neutral for growth in Q2 and to make a sizeable positive contribution in Q3," Westpac economist Andrew Hanlan said in a note.
Across the Tasman Sea, the New Zealand dollar stood at US$0.7275, staying below a five-month peak of US$0.7347 touched last week.
The kiwi again tested the bottom of its recent US$0.7254-US$0.7347 range, but was underpinned by strong domestic factors.
"More broadly, commodity prices have been a support to the NZD highlighted by the 2.1 per cent gain in the June ANZ commodity price index released yesterday," Doug Steel, senior economist at BNZ Markets, said in a note.
"This adds to our view that NZ's terms of trade will hit a record high in 2017; it is a fundamental positive for the NZD."
New Zealand government bonds gained, sending yields down about two basis points across the curve.
Australian government bond futures slipped, with both the three-year bond contract and the 10-year contract off one tick at 98.040 and 97.3600 respectively.