Commodity Currencies Rebound Amid Rising Risk Appetite
May 25 2016 - 9:36PM
RTTF2
Commodity currencies such as the Australian, the New Zealand and
the Canadian dollars rebounded from early lows against their major
counterparts in the Asian session on Thursday amid rising risk
appetite, as the crude oil prices rose near the $50 a barrel
mark.
Crude oil for July delivery are currently up $0.32 to $49.88 a
barrel. The crude oil price rose as official data confirmed a
significant draw down in U.S. oil inventories.
The U.S. Energy Information Administration reported that U.S.
crude supplies fell 4.2 million barrels for the week ended May 20.
Meanwhile, a two-day Group of Seven leaders' summit in Japan that
starts later on Thursday and a speech by U.S. Federal Reserve Chair
Janet Yellen on Friday, limited gains in the equity market.
The aussie fell earlier after the release of nation's capex data
but rebounded in a shortwhile.
Data from the Australian Bureau of Statistics showed that the
private capital expenditure in Australia was down a seasonally
adjusted 5.2 percent on quarter in the first three months of 2016,
standing at A$30.613 billion. That missed forecasts for a decline
of 3.5 percent following the 0.8 percent increase in the three
months prior.
Wednesday, the Australian, the New Zealand and the Canadian
dollars rose against their major counterparts. The Australian
dollar rose 0.51 percent against the yen and 0.06 percent against
the euro. Meanwhile, the aussie held steady against the U.S.
dollar.
The NZ dollar rose 0.07 percent against the U.S. dollar, 0.60
percent against the yen and 0.10 percent against the euro. The
Canadian dollar rose 0.78 percent against the U.S. dollar, 0.77
percent against the yen and 0.65 percent against the euro.
In the Asian trading, the Australian dollar rose to an 8-day
high of 1.0735 against the NZ dollar, from an early low of 1.0656.
The aussie may test resistance near the 1.10 region.
Against the U.S. dollar, the yen and the euro, the aussie edged
up to 0.7215, 79.12 and 1.5491 from early 2-day lows of 0.7163,
78.44 and 1.5594, respectively. If the aussie extends its uptrend,
it is likely to find resistance around 0.74 against the greenback,
82.00 against the yen and 1.50 against the euro.
The aussie advanced to 0.9361 against the Canadian dollar, from
an early more than 6-month low of 0.9325. The aussie is likely to
find resistance around the 0.98 area.
The NZ dollar rose to 1.6612 against the euro and 73.79 against
the yen, from early 2-day lows of 1.6678 and 73.45, respectively.
If the kiwi extends its uptrend, it is likely to find resistance
around 1.62 against the euro and 77.00 against the yen.
Against the U.S. dollar, the kiwi advanced to 0.6727 from an
early near 2-month low of 0.6696. On the upside, 0.68 is seen as
the next resistance level for the kiwi. The Canadian dollar rose to
more than a 3-week high of 1.4505 against the euro and an 8-day
high of 1.2973 against the U.S. dollar, from early lows of 1.4554
and 1.3037, respectively. If the loonie extends its uptrend, it is
likely to find resistance around 1.41 against the euro and 1.26
against the greenback
Against the yen, the loonie edged up to 84.58 from an early low
of 84.02. The loonie may test resistance near the 88.00 region.
Looking ahead, Swiss industrial production for the first
quarter, the second estimate of U.K. GDP data for the first quarter
and U.K. BBA mortgage approvals for April are due to be released
later in the day.
At 6:10 am ET, Federal Reserve Bank of St. Louis President James
Bullard will give Singapore City Lecture on the U.S. economy and
monetary policy before the Official Monetary and Financial
Institution Forum in Singapore.
In the New York session, U.S. durable good orders for April,
pending home sales data for April and U.S. weekly jobless claims
for the week ended May 21 are slated for release later in the
day.
At 9:00 am ET, Reserve Bank of Australia Assistant Governor Guy
Debelle will deliver opening remarks at the launch of the Global
Code of Conduct for the Foreign Exchange Market in New York.
At 12:00 pm ET, Federal Reserve Governor Jerome Powell will
deliver a speech titled "Recent Economic Developments, the
Productive Potential of the Economy, and Monetary Policy: Learning
from the Recovery" at the Peterson Institute for International
Economics in Washington DC.
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