WELLINGTON/SYDNEY: The Australian dollar started the new year on a strong note, reaching record highs on an embattled euro as Europe's debt crisis looked no nearer a resolution while resilient data from China eased fears of a hard landing there.
*Euro down at A$1.2635, having shed two cents in the just past week with technicals pointing for further losses given the emphatic break of major support in the A$1.2900/1.3000 zone.
* Aussie also firms on the US dollar to $1.0230, up from $1.0214 in London on Monday and $1.0157 late here last Friday before the holiday. Support around $1.0200 with resistance at $1.0269.
* Sentiment helped by a rise in China's official PMI to 50.3 in December, up from 49 in November and beating forecasts. That, combined with the prospect of more monetary easing, helped offset worries about a sharp slowdown.
* New Zealand dollar also gained on the euro, which skidded to a 15-week trough around NZ$1.6550 before steadying at $1.6600.
* The kiwi currency was firm on the US dollar at $0.7781 , from $0.7728 late last week.
* Australian bond futures were untraded as yet but could run into some profit taking given the 10-year contract ended at a record high of 96.280 on Friday.
* The implied yield of 3.72 pct is well below the cash rate of 4.25 pct thanks to strong demand from offshore investors for Australia's triple-A rated debt and expectations of further cuts in rates here.
* There are no major economic data due in Australia on Tuesday while New Zealand markets remain on holiday.
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