Australian Dollar Rises Amid Risk Appetite
23:13, 24th May 2016
(RTTNews) - The Australian dollar strengthened against the other major currencies in the pre-European Asian session on Wednesday, as strong cues from overseas markets, receding Brexit worries, rising oil prices and news of a breakthrough deal between Eurozone finance ministers, Greece and the International Monetary Fund to address Athens' requests for debt relief bolstered investors' appetite for risk.
Crude oil for July delivery are currently up $0.62 to $49.24 a barrel. Oil prices were supported by a surge in global equities and industry data showing a larger-than-expected drawdown in crude inventories last week.
Data from industry group the American Petroleum Institute showed that U.S. crude stocks dropped by 5.1 million barrels to 536.8 million last week. The traders now await the data from the Energy Information Administration due today.
In the Asian trading, the Australian dollar held steady against its major rivals.
In the pre-European trading, the aussie rose to a 1-week high of 1.5449 against the euro and a 2-day high of 79.44 against the yen, from early lows of 1.5528 and 78.98, respectively. If the aussie extends its uptrend, it is likely to find resistance around 1.49 against the euro and 82.00 against the yen.
Against the U.S. and the New Zealand dollars, the aussie edged up to 0.7219 and 1.0677 from early lows of 0.7174 and 1.0634, respectively. On the upside, 0.75 against the greenback and 1.09 against the kiwi are seen as the next resistance levels for the aussie.
Meanwhile, the aussie edged up to 0.9449 against the Canadian dollar, from an early low of 0.9413 and held steady thereafter.
Looking ahead, the German Ifo business climate index for May and Swiss ZEW economic sentiment index for May are due to be released later in the day.
At 6:30 am ET, European Central Bank board member Vitor Constancio is expected to speak at Session 2 "The International Monetary and Financial System - A European Perspective" at Joint Bank of England/FESSUD Workshop "Mapping the future of Finance", in London.
In the New York session, U.S. advance goods trade balance for April, U.S. Markit's flash services PMI for May, U.S. FHFA house price index for March and U.S. crude oil inventories data are slated for release.
At 9:00 am ET, Federal Reserve Bank of Philadelphia President Patrick Harker is expected to speak on the economic outlook before the Forum on America's Economy 2016 in Philadelphia.
The Bank of Canada's interest rate decision is due at 10:00 am ET. The economists expect the bank to hold rates at 0.5 percent.
At 2:00 pm ET, Federal Reserve Bank of Dallas President Robert Kaplan will participate in a moderated question-and-answer session before the Greater Houston Partnership Thought Leader Series.
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