Australian Dollar Rises Amid Risk Appetite
May 24 2016 - 11:13PM
RTTF2
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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