Commodity currencies such as the Australian, the New Zealand and the Canadian dollars strengthened against their major currencies in the Asian session on Thursday amid risk appetite, as the Asian shares extended its rally, tracking gains seen in wall street overnight. Upbeat economic news from the U.S. and waning concerns about Chinese stock market swoon also supported positive sentiment.
A report released by the Commerce Department on Wednesday, showed that durable goods orders climbed by 2.0 percent in July after jumping by an upwardly revised 4.1 percent in June. The continued increase surprised economists, who had expected orders to drop by 0.4 percent.
Federal Reserve Bank of New York President William Dudley, a close ally of Fed Chair Janet Yellen, told a press briefing on Wednesday that a September rate hike is looking less compelling than a few weeks ago given the downside risks that international developments could pose to U.S. economic growth.
Meanwhile, crude oil prices rose as the official weekly crude oil inventory data from the U.S. Energy Information Administration showed stockpiles to have declined more than expected last week.
Crude oil for October delivery are currently up $0.88 to $39.48 a barrel.
The aussie trimmed some of its gains after the data showed that Australia’s capital spending dipped on quarter in the second quarter of 2015. However, the currency recovered shortly after.
Data from the Australian Bureau of Statistics showed that the total value of new capital spending in Australia was down a seasonally adjusted 4.0 percent on quarter in the second quarter of 2015. The headline figure missed estimates for a decline of 2.5 percent following the 4.4 percent drop in the first quarter. On a yearly basis, overall capex tumbled 10.5 percent.
Wednesday, the Australian dollar fell as China’s latest move to cut its key interest rate failed to quell investor anxiety about the state of the Chinese economy.
The Australian dollar fell 0.09 percent against the U.S. dollar, 0.82 percent against the yen and 0.20 percent against the euro. Meanwhile, the New Zealand and the Canadian dollars showed mixed trading against its major rivals.
In the Asian trading, the Australian dollar rose to 2-day highs of 86.02 against the yen, 1.5834 against the euro and 1.1074 against the NZ dollar, from yesterday’s closing quotes of 85.39, 1.5879 and 1.1051, respectively. If the aussie extends its uptrend, it is likely to find resistance around 90.00 against the yen, 1.52 against the euro and 1.14 against the kiwi.
Against the U.S. and the Canadian dollars, the aussie edged up to 0.7154 and 0.9499 from yesterday’s closing quotes of 0.7120 and 0.9463, respectively. The aussie may test resistance near 0.73 against the greenback and 0.93 against the loonie.
The NZ dollar rose to 0.6473 against the U.S. dollar, from yesterday’s closing value of 0.6431. The kiwi may test resistance near 0.67 region.
Against the yen and the euro, the kiwi edged up to 77.85 and 1.7498 from yesterday’s closing quotes of 77.14 and 1.7555, respectively. If the kiwi extends its uptrend, it is likely to find resistance around 83.00 against the yen and 1.66 against the euro.
The Canadian dollar rose to a 3-day high of 1.5029 against the euro and a 2-day high of 90.62 against the yen, from yesterday’s closing quotes of 1.5035 and 90.20, respectively. If the loonie extends its uptrend, it is likely to find resistance around 1.46 against the euro and 93.00 against the yen.
Against the U.S. dollar, the loonie edged up to 1.3271 from yesterday’s closing value of 1.3291. On the upside, 1.31 is seen as the next resistance level for the loonie.
Looking ahead, Swiss GDP data the second quarter is due to be released at 1:45 am ET. Additionally, German import price index for July and U.K. nationwide house price index for August are set to be announced at 2:00 am ET.
Swiss industrial production for the second quarter and Eurozone M3 money supply data for July are also set to be published.
In the New York session, preliminary U.S. GDP data for the second quarter and pending home sales data for July are slated for release.
At 7:00 am ET, European Central Bank board member Benoit Coeure is expected to speak at the Conference of Ambassadors organized by the French ministry of foreign affairs in Paris.
At 11:30 am ET, German Chancellor Angela Merkel, EU foreign policy chief Federica Mogherini, European Commission Vice President Maros Sefcovic, European Bank for Reconstruction and Development President Sir Suma Chakrabarti and prime ministers of Italy, Serbia, Slovenia, Croatia and Albania are expected to attend Western Balkans Summit in Vienna.
The material has been provided by InstaForex Company – www.instaforex.com