SYDNEY/WELLINGTON: The Australian and New Zealand dollars seemed to find a steadier footing late Friday as a rally in Asian stock markets and upbeat Japanese economic news helped offset the drag from a sliding gold price.
The Aussie currency was holding its own at $0.9266, and off the 33-month trough of $0.9148 plumbed at the start of the week. Yet a couple of attempts to extend the bounce had faltered in the face of offers around $0.9340.
The New Zealand dollar outperformed its Aussie mate, which fell 0.2 percent to NZ$1.1866.
Against the greenback, the kiwi edged up to $0.7810 and away from a one-year low of $0.7683 set on Monday. Near-term support was seen around $0.7750 and $0.7720, with $0.7830 lining up as resistance.
The Antipodeans gained on the yen as the Nikkei rallied sharply on the back of upbeat Japanese economic data. Japan is Australia's second biggest export market and tends to benefit from any sign that stimulus policies are working there.
That helped offset a drop in gold to a three-year trough under $1,200 an ounce. The precious metal, which is a major export earner for Australia, is on course for its worst quarterly performance since at least 1968.
There was noting major in terms of local data on Friday. Next week's main focus is the Reserve Bank of Australia's (RBA) interest rate decision on Tuesday.
Most analysts polled by Reuters expect the RBA to stand pat on rates, in part due to the recent steep decline in the Aussie.
"The AUD's depreciation has been essentially across the board. Given the importance of the currency in recent monetary policy deliberations, a cut at the July window looks to be extremely unlikely," said Justin Smirk, economist at Westpac Bank.
"This does not, however, mean that the RBA is set to remove their current easing bias."
The head of the central bank, Glenn Stevens, is also due to give a speech on July 3 which could be very important in setting the outlook for rates.
Currently the market implies only a one-in-five chance of an easing next week, but does have a cut to 2.5 percent priced in by October.
Australian debt futures crept higher following a positive lead from US Treasuries. The 10-year bond contract put on 5.5 ticks to 96.220, marking a sizable turnaround from early in the week when it hit 15-month lows at 95.840. The three-year bond contract rose 6 ticks to 97.210.
New Zealand government bond prices were also slightly bid, with yields 2 basis points lower along the curve.
Comments
Comments are closed.