The Australian dollar came within a whisker of cracking the 80 US cent barrier on Wednesday for the first time since September, only for the rally to be frustrated by profit-taking at the last hurdle. The Aussie was a fraction firmer at $0.7964, having stretched as far as $0.7999 at one stage before faltering.
Dealers said the run higher had come as a break of Monday's peak at $0.7979 sparked a round of stop-loss bids. Clearing 80 cents was seen as an important marker technically, opening the way to September's double top at $0.8105 and $0.8125. Investor demand for Aussie assets was evident at a syndicated offer of new government 2029 bonds where A$9.6 billion ($7.65 billion) were sold, the second largest on record.
The New Zealand dollar lagged at $0.7258, still short of Monday's four-month high at $0.7315. The kiwi failed to get much of a lift out of a jump in global dairy prices, perhaps because the rise was partly due to supply constraints within New Zealand.
Australian government bond futures were a shade easier, with the three-year bond contract down 1.5 ticks at 97.780. The 10-year contract dipped 1 tick to 97.2150. The pulse of domestic news also remained upbeat with an index of consumer sentiment rising to its highest in four years in January, adding to signs that households were ready to spend following a long fallow period. Retail sales surged in November, data showed recently, as consumers splashed out on iPhones and "Black Friday" shopping deals, while new vehicle sales jumped to a record in December. Official figures on Wednesday also showed a solid 2.1 percent rebound in mortgage commitments for November, when forecasts had been for a small decline.
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