The Australian dollar held near 12-week peaks against the US dollar on Friday, still basking in the glow of the country's biggest ever trade surplus and the promise of more to come. The Australian dollar stood at $0.7655, having climbed 1 percent on Thursday to as far as $0.7696 its highest since November 10.
Official data on Thursday had showed a trade surplus of A$3.51 billion ($2.67 billion) in December, much higher than forecasts of A$2.2 billion. With prices for iron ore and coal still strong, surpluses were likely to run for a few months yet. "The big lift in commodity prices has taken the trade balance back into the black," said Kristina Clifton, economist at Commonwealth Bank.
Elsewhere, too, the Aussie fared well. It stood near a 19-month peak on the euro and was steady on the pound, after rising nearly 2 percent on Thursday. The New Zealand dollar was little changed at $0.7288, just off a near 10-week high of $0.7350 touched earlier in the week. mThe Kiwi was up 0.3 percent for the week, on track for its sixth straight weekly gain.
However, the Kiwi has suffered big losses against its Australian cousin in recent weeks. Since the start of the year, the Kiwi has posted only one weekly gain. New Zealand government bonds gained, sending yields 1.5 basis points lower at the long end of the curve.
Australian government bond futures eased, with the three-year bond contract down 2 ticks at 98.010. The 10-year contract was off 1 tick at 97.190. "Net exports are set to make a strong contribution to Q4 GDP growth and the current account deficit should narrow significantly."
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