WELLINGTON/SYDNEY: The Australian and New Zealand dollars settled into a slim trading range on Tuesday in the absence of fresh impetus, a day after reaching multi-week highs on optimism over China's economic growth.
The Australian dollar was steady at $0.9431, having drifted between $0.9418/32 so far. It climbed 0.4 percent on Monday to an 11-week high of $0.9445 after a survey showed activity in China's factory sector expanded in June for the first time in six months.
The rally has swept the Aussie to within striking distance of its 2014 peak at $0.9461.
A break above would take it to levels not seen since late 2013.
"While the Chinese manufacturing figures offered the currency a jolt, the rest of the week does not offer many potential catalysts in terms of domestic data that could spur further gains for the Aussie," said David de Ferranti, analyst at FXCM in Sydney.
"A push higher may hinge on US dollar weakness, which puts the spotlight on upcoming US Consumer Confidence and housing data."
The Aussie was a touch softer against the yen at 95.93 , but still near a 12-week peak of 96.31 set on Monday. The euro was flat at A$1.4430 after recovering from a one-week low of A$1.4372. Similarly, the New Zealand dollar was taking it easy at $0.8714 after notching a six-week high of $0.8749 on Monday.
BNZ analysts said macro accounts had been seen as sellers of both Antipodean currencies. "Traders will continue to respect the $0.8680 level as first support, with resistance still defined by the $0.8750 level on our order book," said strategist Raiko Shareef in a note.
A challenge of the kiwi's three-year high of $0.8779 set in May remains on the cards given the strong prospect the Reserve Bank of New Zealand will raise interest rates to 3.5 percent next month.
The kiwi was a hint softer against the Japanese currency at 88.70 yen ahead of an expected announcement by Prime Minister Shinzo Abe of further measures to stimulate the world's third-biggest economy.
New Zealand government bonds had a mild offered tone, pushing yields half a tick higher along the curve.
Australian government bond futures managed to recover from Monday's fall, with the three-year bond contract up 3 ticks at 97.230. The 10-year contract was 4.5 ticks higher at 96.340.
Comments
Comments are closed for this article.