Australian, NZ Dollars Advance Amid Rising Risk Appetite
24 March 2020 - 1:49PM
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The Australian and New Zealand dollars climbed against their
major counterparts in the Asian session on Tuesday, as most Asian
shares rose amid optimism about more stimulus measures by central
banks and governments to the combat the impact of the coronavirus
pandemic on the global economy.
Investor sentiment received a boost after the U.S. Federal
Reserve announced extensive new measures, including an unlimited
expansion of its asset purchases, to support the world's largest
economy during the coronavirus pandemic.
Banks borrowed a total of $89.3 billion (76.69 billion pounds)
from the central bank's one-week dollar funding operation amid
virus-led disruptions, the Bank of Japan said.
The borrowing was well beyond its previous record of $50.2
billion, hit during the 2008 global financial crisis.
Flash survey data from IHS Markit showed that Australia's
private sector output declined sharply in March.
The Commonwealth Bank of Australia composite output index fell
to 40.7 in March from 49.0 in February. A score below 50 indicates
contraction in the sector.
The aussie advanced to 4-day highs of 0.5945 against the
greenback and 1.8169 against the euro, from its early lows of
0.5812 and 1.8459, respectively. The aussie is likely to find
resistance around 0.70 against the greenback and 1.61 against the
euro.
Reversing from its early lows of 64.64 against the yen and
0.8430 against the loonie, the aussie spiked up to a 1-week high of
65.64 and a 5-day high of 0.8563, respectively. The next possible
resistance for the aussie is seen around 75.00 against the yen and
0.90 against the loonie.
The aussie edged up to 1.0256 against the kiwi, from a low of
1.0197 seen at 5:00 pm ET. If the aussie extends rise, 1.06 is
possibly seen as its next resistance level.
The kiwi strengthened to 4-day highs of 0.5806 against the
greenback, 64.11 against the yen and 1.8602 against the euro, off
its early lows of 0.5684, 63.21 and 1.8868, respectively. The kiwi
is poised to test resistance around 0.64 against the greenback,
69.00 against the yen and 1.72 against the euro.
Looking ahead, PMI reports from major European economies are due
in the European session.
In the New York session, U.S. new home sales for February are
scheduled for release.
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