SYDNEY: The Australian dollar faltered on Wednesday as a bout of selling hit its New Zealand neighbour, though a solid report on the domestic economy cleared the way for another rise in interest rates this month.
The Aussie eased to $0.7160 and was threatening support at $0.7150, having repeatedly failed to crack resistance around $0.7203 over the past two days.
The kiwi took a sudden spill to $0.6488, after its failure to clear $0.6564 on Tuesday seemed to trigger a shake-out of long positions. Support now lies around $0.6450.
The Australian data showed the economy grew a stronger-than-expected 0.8% in the first quarter, keeping annual growth at a respectable 3.3%.
Price measures in the report showed inflation picking up steam across the economy, though wages were more mixed.
“All indicators show the economy to be doing well, actually very well,” said Craig James, chief economist at CommSec.