The Australian and New Zealand dollars firmed on Thursday as hopes for an easing in China briefly lifted sentiment, though investors remain cautious ahead of a key Spanish debt auction. The Aussie marked time at $1.0352, having touched a session high of $1.0388 after Chinese state media reported Beijing was soon to ease policy.
However, hopes of an immediate cut to the banks' reserve requirements were quickly dashed when the report cited an unnamed official saying the bank will "increase reverse repo operations at an appropriate time" and "cut the reserve requirement ratio ... to release liquidity."
The New Zealand dollar stayed firm around $0.8166 in late trade after a quiet session, from its late New York level of $0.8146, ignoring tame local inflation data. The Aussie and the kiwi regained ground on the yen, having run into a bout of profit-taking overnight.
The Australian dollar was at 84.43 yen, approaching this week's high of 84.72. It's been a volatile week for the pair with demand from Japanese importers underpinning the Aussie recovery from a steep fall to 82.82 on Tuesday. The local dollar, 0.5 percent higher so far this week, was nearing key resistance at 84.80 yen, the 20-day MA and the 38.2 percent retracement of the March/April fall.
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