Aussie & kiwi dollars retreat vs firmer euro, resume yen rise

  WELLINGTON/ SYDNEY: The Australian and New Zealand dollars were softer against the euro on Tuesday after a polic
11 Feb, 2013

 

 

* The euro gains across the board after the head of the Bundesbank Jens Weidmann said talk of an overvalued euro is a diversion from governments sorting out their economies.

 

* That sees the euro halt three days of losses, rising 0.4 percent on the Aussie to A$1.3015 and a more modest 0.2 percent on the New Zealand dollar to NZ$1.5997.

 

* Yet the yen also loses on more talk from Japanese officials backing a weaker currency, while a potential candidate to head the Bank of Japan says reaching a 2 percent inflation target could be done in two years.

 

* The Antipodeans claw back Monday's losses and head higher. Aussie bounds 0.6 percent higher to 96.10 yen in sight of the four-and-a-half year peak of 97.42 set last Tuesday.

 

* The kiwi does better, rising 0.9 percent to 78.26 yen . It climbed as far as 79.41 last week.

 

* The Aussie and kiwi have gained around 16 percent since November on the belief that true reflation in Japan means a much weaker yen.

 

* The Aussie shows further softness on the greenback, falling to $1.0287 from around $1.0304 late locally on Monday. It ranged just above a three-month low at $1.0262 to $1.0303 overnight.

 

* The Aussie is seen supported around $1.0256, the low for the year, and more solidly below that at $1.0236, with resistance at $1.0349.

 

* The New Zealand dollar fares better, managing a slight lift on the US dollar to $0.8362, from $0.8345 in late local trade on Monday. It ranged $0.8310 to $0.8379 overnight.

 

* Kiwi support seen at $0.8345 with $0.8415 capping the topside. Activity through thinned by the Lunar New Year holidays in many Asian markets.

 

* Key events for the Antipodean currencies this week will be statements from officials at the US Federal Reserve and a G20 meeting on Thursday and Friday attended by global finance ministers and central bank governors.

 

* Locally New Zealand has electronic card retail sales data, with a modest lift expected, while Australia has the NAB monthly business survey.

 

* New Zealand government bonds open flat.

 

* Australian government bond futures drift lower with the three-year contract 0.01 points lower at 97.220 and the 10-year contract easing 0.015 points at 96.565.

 

Copyright Reuters, 2013

 

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