WELLINGTON/SYDNEY: The Australian and New Zealand dollars paused against the greenback and held their ground on a wobbly euro on Friday, though the mood remained fragile ahead of key jobs data in the United States.
Aussie dollar consolidates around $1.0707, from $1.0745 in New York, after rising to a one-month high of $1.0765 in offshore trade.
Resistance seen around $1.0740 with talk of very good selling interest ahead of a $1.0800 option barrier, according to traders. Support is found at $1.0600.
Soggy Asian equities, with Korea, Japan and Australian stocks down 1 pct, weigh on commodity currencies.
Aussie had received a boost on Thursday on better-than-expected retail spending and a solid outlook for business investments that augured well for growth.
Markets price out deep rate cut expectations with interbank futures implying 70 bps of easing by year-end, down from well-over 100 bps last month.
Rate markets imply a mere 22 percent chance of a 25 bps cut next week when the central bank holds its September policy meeting. Economists anticipate the Reserve Bank to keep rates at 4.75 pct for a tenth straight month.
A broadly weaker euro buys A$1.3320 , after falling more than 1 pct overnight to one-month lows against the Aussie. Uncertainty over the Greek rescue package and worries about European banks weighing on the common currency.
Resistance seen at A$1.3476, the 55-day MA, with support at A$1.3200, the daily lows of late July.
Euro also depressed on the kiwi at NZ$1.6768 , after hitting a one-month trough of NZ$1.6725 overnight.
Against the greenback, the NZ dollar trades at $0.8519, up from $0.8509 in New York. Support starts from $0.8467 while resistance seen around $0.8573.
Aussie softer at NZ$1.2578, off a one-week high of NZ$1.2593 struck on Thursday.
Kiwi unmoved after NZ's Fonterra reaffirmed its payout to farmers in the current season despite global uncertainty.
NZ has seen a series of encouraging data, but markets still only see a one-in-four chance of a rate hike on Sept. 15 because of cloudy global outlook.
NZ government bonds little changed. A NZ$300 million offer of government bonds attracted only NZ$362 million in bids on Thursday, with the 2023 bond offer failing to attract sufficient offers.
Australian bond futures gained, with the 3-year contract up 0.06 points at 96.16 and the 10-year 0.025 points higher at 95.595.
Copyright Reuters, 2011
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