Australian Dollar Strengthens On Hopes For U.S. Tariff Delay
December 10 2019 - 9:15PM
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The Australian dollar climbed against its major counterparts in
the Asian session on Wednesday, as most Asian shares rose following
reports that Washington is laying the groundwork for a delay in the
latest tariffs on China, due to take effect on Sunday.
However, White House economic adviser Larry Kudlow said the
"tariffs are still on the table". Analysts say that a trade deal
might have to wait until after the U.S. presidential election in
November 2020.
Investors also await the U.S. Federal Reserve's monetary policy
decision due later in the day. The Fed is widely expected to leave
interest rates unchanged, although investors will pay close
attention to the accompanying statement for clues about the outlook
for rates.
Survey data from Westpac showed that Australia's consumer
sentiment weakened in December in consistent with sharp decline in
consumer spending in the third quarter.
The Westpac-Melbourne Institute Index of Consumer Sentiment
declined 1.9 percent to 95.1 in December.
The aussie rose to 0.6820 against the greenback and 74.16
against the yen, reversing from its early lows of 0.6805 and 73.95,
respectively. The next possible resistance for the aussie is found
around 0.71 against the greenback and 76.5 against the yen.
The aussie recovered from an early session's low of 0.9005
against the loonie and near a 2-week low of 1.6299 against the
euro, rising to 0.9023 and 1.6260, respectively. The aussie is seen
finding resistance around 0.92 against the loonie and 1.60 against
the euro.
The aussie appreciated to a 5-day high of 1.0447 versus the
kiwi, following more than a 4-month low of 1.0389 seen at 7:00 pm
ET. The aussie is likely to test resistance around the 1.06
level.
Data from Statistics New Zealand showed that New Zealand credit
card spending rose a seasonally adjusted 1.0 percent on month of
NZ$83 million in November - in line with expectations following the
0.2 percent drop in October.
Retail credit card spending jumped 2.6 percent on month or
NZ$150 million, beating forecasts for 0.5 percent following the 0.6
percent decline in the previous month.
Looking ahead, U.S. consumer price index for November will be
featured in the New York session.
At 2:00 pm ET, the Federal Reserve's interest rate decision is
slated for release. Economists widely expect the central bank to
retain the benchmark rate at 1.50 percent - 1.75 percent.
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