Australian Dollar Extends Rise Amid Rising Risk Appetite
15 February 2017 - 12:27PM
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The Australian dollar continued to be strong against other major
counterparts in the Asian session on Wednesday on rising risk
appetite, tracking the overnight gains on Wall Street following
comments from Federal Reserve Chair Janet Yellen and upbeat
corporate earnings results.
In her semi-annual monetary policy testimony before the Senate
Banking Committee, Yellen said that the Federal Reserve can raise
interest rates at a gradual pace and spoke in support of an
interest rate hike in Fed's March 14-15 policy meeting. Yellen also
said that waiting too long to raise interest rates could be
disastrous for the economy.
In the economic news, data from Westpac Bank revealed that
consumer confidence in Australia climbed in February. The index
advanced 2.3 percent to a score of 99.6.
Data from the Australian Bureau of Statistics showed that total
new motor vehicle sales in Australia were up a seasonally adjusted
0.3 percent on month in January, coming in at 97,636. That follows
the 0.3 percent increase in December.
Tuesday, the Australian dollar had risen 0.22 percent against
the U.S. dollar, 0.09 percent against the yen, 0.42 percent against
the euro, and 0.21 percent against the NZ dollar. Meanwhile, the
aussie fell against the Canadian dollar.
In the Asian trading, the Australian dollar rose to nearly a
2-year high of 1.3772 against the euro and a 1-year high of 87.79
against the yen, from yesterday's closing quotes of 1.3804 and
87.56, respectively. If the aussie extends its uptrend, it is
likely to find resistance around 1.36 against the euro and 88.00
against the yen.
Against the Canadian and the New Zealand dollars, the aussie
advanced to a 2-day high of 1.0042 and nearly a 4-month high of
1.0707 from yesterday's closing quotes of 1.0015 and 1.0688,
respectively. The aussie may test resistance around 1.02 against
the loonie and 1.08 against the kiwi.
The aussie edged up to 0.7679 against the U.S. dollar, from
yesterday's closing value of 0.7657. On the upside, 0.79 is seen as
the next resistance level for the aussie.
Meanwhile, the safe-haven U.S. dollar fell against its major
rivals amid rising risk appetite.
In the Asian trading, the U.S. dollar fell to 114.24 against the
yen from an early more than 2-week high of 114.51. The greenback is
likely to find support around the 111.00 region.
Against the euro, the pound and the Swiss franc, the greenback
dropped to 1.0586, 1.2471 and 1.0057 from yesterday's closing
quotes of 1.0573, 1.2466 and 1.0063, respectively. If the greenback
extends its downtrend, it is likely to find support around 1.08
against the euro, 1.27 against the pound and 0.99 against the
franc.
The greenback dropped to 0.7176 against the NZ dollar from
yesterday's closing value of 0.7168. On the downside, 0.73 is seen
as the next support level for the greenback.
Against the Canadian dollar, the greenback edged down to 1.3065
from an early high of 1.3096. The greenback may test support near
the 1.29 region.
Among the scheduled events today, U.K. jobs data and Eurozone
trade balance, both for December are due to be released later in
the day.
In the New York session, Canada manufacturing sales data for
December and existing home sales data for January, U.S. CPI data
for January, retail sales data for January, industrial production
for January, business inventories for December, crude oil
inventories data, U.S. Empire State manufacturing index for
February, and U.S. NAHB housing market index for February are
slated for release.
At 10:00 am ET, Federal Reserve Chair Janet Yellen will testify
on the Semiannual Monetary Policy Report before the House Financial
Services Committee, in Washington DC.
At 12:00 pm ET, Boston Fed President Eric Rosengren is expected
to speak before a New York Association for Business Economics
luncheon, in New York.
At 12:45 pm ET, Federal Reserve Bank of Philadelphia President
Patrick Harker is expected to speak about the economic outlook at
La Salle University, in Philadelphia.
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