The Australian dollar climbed past parity on Tuesday as optimism on global growth lifted commodity prices, a trend highlighted by the country's central bank as it played down the impact of floods on the domestic economy. The Australian dollar bounced above parity to a session high of $1.0039, from $0.9963 in early trade. Its recovery from a low of $0.9866 on Monday caught many speculators short and forced them to buy back the dollar.
It was last at $1.0024, having broken several key resistance levels and was now targeting the January 19 high at $1.0077. The Australian dollar also proved resilient to a closely watched Chinese manufacturing index which came in below expectations at 52.9 in January. In contrast a separate PMI from HSBC showed a small rise to 54.5, while measures from India and Russia were also strong. The New Zealand dollar firmed to $0.7740, up from a low of $0.7681 on Monday. Support was seen at $0.7685, the low on Monday, with resistance at $0.7795, the January 28 high.
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