Aussie and NZ dlrs struggle, bonds rally
31 August, 2012 - Reuters
WELLINGTON/SYDNEY, Aug 31 (Reuters) - The Australian and New Zealand dollars were hovering around one-month lows on Friday as commodities remained under pressure and investors fretted about the chances of further stimulus for the U.S. economy. Australian government bonds benefit, with three-year futures jumping to highest in a month at 97.570 for an implied yield of 2.46 pct. Key resistance at 97.598, the 50 pct retracement of the June-August decline. The 10-year contract climbs to 97.02, its strongest since Aug. 3, with an implied yield of 3 percent. That is well below the 3.5 percent cash rate. Aussie slips to $1.0290 , from $1.0337 in late trade Thursday, having breached the 200-day MA of $1.0311. It is now on track to post a near-2 pct loss for the month, though it is still up 0.7 pct for the year. Support for the Aussie seen initially at the cloud top of$1.0279, ahead of $1.0220, the 38.2 pct of the May-Aug rise. Resistance found at $1.0311, Thursday's high. The New Zealand dollar similarly soggy at $0.7994, from $0.8027 late on Thursday. It is hovering near a five-week low of $0.7970 hit this week. Technicals point to more downside risk in the kiwi, as a clean break below its 200-day MA at $0.7999 opens the door to a slide to $0.7937, the 100-DMA. Traders cite bids around $0.7950, which may offer some support. Uncertainty is high that U.S. Federal Reserve Chairman Ben Bernanke will offer any signal of a further monetary stimulus when he speaks in Jackson Hole later in the day. As a result, Antipodeans struggle across the board, hovering at multi-week lows against euro, yen, sterling and Swissy. Euro stellar performer this month as investors trimmed short euro positions even as there has been no new concrete development on a European debt plan. Common currency is on track to post a 3.7 pct gain in August on the Aussie , its largest monthly increase since March. It climbed to a two-month peak of A$1.2170 and was last at A$1.2156 with technicals suggesting a consolidation on the horizon. Likewise, euro up 3 pct on the kiwi in August , its biggest monthly gain in a year. Last at NZ$1.5655, having risen to NZ$1.5705 on Thursday, its highest since early July. Aussie has been weighed by a sharp fall in spot iron ore prices which hit their lowest levels since late 2009
. Iron ore is Australia's single biggest export earner. Data in Australia showed private credit rose 0.2 percent in July, slightly under forecasts of 0.4 pct. New Zealand government bonds rise as global uncertainty prompts domestic demand for safe-haven debt. Strong tender results on Thursday also support, pushing yields 6.5 basis points lower at the long end of the curve.
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