SYDNEY: The Australian and New Zealand dollars were proving resilient on Tuesday as high commodity prices and strength in domestic economies provided a buffer against geopolitical tensions.
The Aussie stood at $0.7254, having bounced 0.4% overnight and away from support at $0.7152. It faces resistance at the recent top of $0.7284 and the January peak of $0.7314.
The kiwi dollar held at $0.6754, after gaining 0.5% overnight. With support at $0.6656 proving solid, the focus was on its recent top at $0.6808.
Both gained more ground on the euro, which slid 0.8% overnight to a four-month low at A$1.5426.
Some of the demand was simply due to geography, with Australia and New Zealand distant to the troubles in Europe and little exposed to Russian trade.
Australia as a net energy exporter is also set to gain from higher commodity prices, with liquefied natural gas and coal up sharply, while wheat, nickel, aluminium and iron ore were all firm.
"The very aggressive moves in thermal energy markets continue," said Richard Franulovich, head of FX strategy at Westpac. "So there can be no debate here, the commodity story remains super supportive for the A$."
"The key band of resistance at $0.7180/0.7240 has given way and the A$ remains in a flag formation that points up to the 200dma at $0.7333."
Data out of Australia showed trade was much less of a drag on growth than first thought last quarter and led analysts to revise up forecasts for gross domestic product, data for which are due on Wednesday.
Median forecasts had been for an already rapid rise of 3.0%, but analysts at NAB were now looking for 3.5%, CBA tipped 3.7% and Westpac 3.9%.
The brisk recovery was noted by the Reserve Bank of Australia (RBA) as it kept interest rates steady at 0.1% after a monthly policy meeting.
RBA Governor Philip Lowe also cited the war in Ukraine as a new source of global uncertainty and said the bank would be patient before raising interest rates.
Events abroad have already seen markets push out a first hike to July from June, and remove one rate rise from this year to imply four increases to 1.0% by Christmas.
Yields on three-year bonds have likewise fallen 16 basis points in the last couple of days to stand at 1.398%.
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