WELLINGTON/SYDNEY: The Australian dollar lost altitude on its US counterpart on Thursday as a failure to rally on upbeat Chinese data led speculators to cut back on long positions, though the New Zealand currency had no such trouble.
The Aussie eased back to $1.0513, from an early $1.0552, while its kiwi cousin crept ahead to $0.8430, from $0.8410.
"It looks exhausted, having failed at $1.0600 for a week now," said David Scutt, a trader at Arab Bank Australia.
"If it can't rally on strong Chinese data, it means it's due for a pull back," he said, seeing it testing $1.0500 or $1.0470, both major retracement levels.
The Aussie got only a brief lift from the latest HSBC survey of China's factory sector which showed growth accelerated to a two-year high in January. China is a major export market from Australia and New Zealand and a pick up there would be supportive of earnings and commodity prices in general.
In contrast, the kiwi was not far from a high of $0.8462 touched earlier this month.
"The kiwi should remain strong, without a break into new territory," said ANZ Bank head of market research David Croy.
The currency has held between $0.8324 and $0.8462 for the past three weeks. Technically, support remained around $0.8380 with the first line of resistance seen at $0.8450.
The Aussie dollar fared better against the yen, given the Japanese government's determination to fight deflation and lower the currency.
It last fetched 93.86 yen, having bounced from an early low of 93.05. The kiwi dollar bought 74.08 yen, up 0.6 percent in the day, not far from 75.80 last week, its strongest since 2008.
Both currencies have risen more than 12 percent on the yen since November.
The Aussie and kiwi also held major overnight gains against the Canadian dollar which skidded after the Bank of Canada surprised with a dovish statement, putting back the likely timing of any tightening.
The Aussie was last at C$1.0512, having leaped to a five-month high at C$1.0540, and eyeing the August peak at C$1.0597.
The kiwi was a clear outperformer, having surged to its highest in more than five years at C$0.8442.
Australian bond futures crawled to their highest since late December, well off multi-month lows hit earlier in January. The three-year bond contract added 0.04 points to 97.330, while the 10-year contract was up 0.02 points to 96.755.
New Zealand government bonds were almost unchanged.