The Australian and New Zealand dollars extended short-covering gains on Tuesday, proving resilient to budget cuts in Australia, various ratings warnings for Europe and nerves ahead of a key Italian bond auction. The Aussie grinded higher to $0.9950, from $0.9891 in New York, having peaked at $0.9976 on Monday as markets underwent one of their periodic bouts of optimism over Europe.
A wave of short-covering pushed the Aussie two full cents higher in two sessions, while Asian central bank buying and firmer stocks across the region provided further aid. Chart support is found at $0.9830 with resistance at $0.9976. The kiwi dollar firmed to $0.7560, from $0.7542 in New York, well-off last week's seven-month trough. It hit a one-week high of $0.7574 offshore, up one-and-a-half cents since Friday. The Antipodeans were higher against the safe-haven yen. The Aussie firm at 77.34 yen, off a seven-week low of 74.72 hit last week. The kiwi was up at 58.94 yen.
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