Commodity Currencies Rise Amid Rising Risk Appetite
August 13 2015 - 12:51AM
RTTF2
The commodity currencies such as the Australian, New Zealand and
the Canadian dollars strengthened against their major currencies in
the Asian session on Thursday despite China lowering the yuan's
reference rate further on Thursday.
Investors are cautiously optimistic following China's currency
devaluation. The People's Bank of China lowered its daily reference
rate 1.1 percent to 6.4010 yuan per dollar on Thursday, following
reductions of 1.6 percent on Wednesday and 1.9 percent on
Tuesday.
Meanwhile, crude oil prices rebounded amid the dollar weakness
and the release of official data from the Energy Information
Administration showed crude stockpiles in the U.S. to have declined
last week, albeit less than expected.
In other economic news, data from the Statistics New Zealand
showed that food prices in New Zealand gained 0.6 percent on month
in July, following the 0.5 percent gain in June and the 0.4 percent
increase in May. On a yearly basis, food prices jumped 1.2 percent
after easing 0.1 percent in the previous month and 0.8 percent in
May.
Data from Melbourne Institute showed that Australia inflation
expectations increased further at a faster pace in August from the
previous month. The expected inflation rate rose to 3.7 percent in
August from 3.4 percent in July.
Wednesday, commodity currencies fell against their major rivals
following Chinese central bank devaluing its currency. The
Australian dollar fell 1.05 percent against the U.S. dollar, 0.31
percent against the yen and 0.78 percent against the euro. The NZ
dollar fell 1.19 percent against the U.S. dollar, 0.44 percent
against the yen and 0.79 percent against the euro. The Canadian
dollar fell 1.05 percent against the U.S. dollar, 0.31 percent
against the yen and 0.27 percent against the euro.
In the Asian trading, the Australian dollar recovered to 2-day
highs of 92.06 against the yen and 1.5046 against the euro, from
recent lows of 91.18 and 1.5208, respectively. At yesterday's
close, the aussie was trading at 91.68 against the yen and 1.5110
against the euro. If the aussie extends its uptrend, it is likely
to find resistance around 94.50 against the yen and 1.47 against
the euro.
Against the U.S. and the Canadian dollars, the aussie advanced
to 2-day highs of 0.7409 and 0.9603 from recent lows of 0.7331 and
0.9542, respectively. At yesterday's close, the aussie was trading
at 0.7382 against the greenback and 0.9579 against the loonie. The
aussie may test resistance around 0.74 against the greenback and
0.97 against the loonie.
The NZ dollar rose to 2-day highs of 82.51 against the yen and
1.6756 against the euro, from yesterday's closing quotes of 82.17
and 1.6854, respectively. If the kiwi extends its uptrend, it is
likely to find resistance around 83.50 against the yen and 1.65
against the euro.
Against the U.S. dollar, the kiwi edged up to 0.6641 from
yesterday's closing value of 0.6617. On the upside, 0.67 is seen as
the next resistance level for the kiwi.
The Canadian dollar rose to 2-day highs of 95.94 against the yen
and 1.4434 against the euro, from yesterday's closing quotes of
95.69 and 1.4476, respectively. If the loonie extends its uptrend,
it is likely to find resistance around 97.50 against the yen and
1.41 against the euro.
Against the U.S. dollar, the loonie edged up to 1.2955 from
yesterday's closing value of 1.2975. The loonie may test resistance
around the 1.28 area.
Meanwhile, the Australian dollar fell to 1.1118 against the NZ
dollar earlier and held steady thereafter.
Looking ahead, final German CPI estimate for July is due to be
released at 2:00 am ET.
Swiss producer and import prices for July are also set to be
announced later on in the day.
At 7:30 am ET, the European Central Bank is set to publish the
minutes of its July policy meeting.
In the New York session, U.S. advance retail sales data for
July, U.S. weekly jobless claims for the week ended August 8 and
Canada new housing price index for June are slated for release.
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