Australian dollar firm on steady rates outlook, U.S. data eyed

Fri, 07 Mar - 12:01pm

* Aussie settles just off highs ahead of US data

* RBA head reiterates stable rates, A$ high

* RBA head has "nothing new to say" on A$

* Euro posts gains on Antipodeans

By Gyles Beckford

WELLINGTON, March 7 (Reuters) - The Australian dollar was in sight of a three-month high as the central bank governor reaffirmed the outlook for steady rates but made no attempt to talk down the currency, as investors awaited closely-watched U.S. jobs data.

The Aussie AUD=D4 was trading around $0.9085, after touching a three-month high of $0.9111 overnight.

The currency has gained more than 2 percent this week on the back of stronger-than-expected data pointed to the economy feeling the benefit of low interest rates.

Reserve Bank of Australia governor Glenn Stevens said there was no need for lower rates, echoing the statement earlier in the week of a steady rates outlook.

"We have signalled the likelihood, if the economy evolves more or less as expected, of a period of stability in the cash rate," he said in his twice-yearly Parliamentary testimony.

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Stevens noted the Australian dollar had fallen recently, but said he had "nothing new to say" about the currency other than at above $0.9000 it was high by historical standards.

The Aussie was seen holding its gains ahead of U.S. non-farm payrolls data later on Friday, with resistance initially around $0.9125 ahead of a more substantial barrier at $0.9170.

"The momentum is to the upside with the strong local data, stable rates, and continuing weak U.S. data," said Westpac senior strategist Imre Speizer.

A Reuters poll of economists is forecasting 150,000 workers were added to payrolls last month, although there is uncertainty given the severe weather that gripped much of the country.

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Speizer said it was likely to be another month before there was some clarity about U.S. data, which would likely weigh on the greenback and be positive for the Antipodeans.

The euro gained on the Antipodeans after the European Central Bank left rates unchanged and the President Mario Draghi reaffirmed an easy policy for the foreseeable future.

The single currency bounced off the three-week low touched on Thursday to A$1.5253 EURAUD=R , still shy of Monday's peak of A$1.5500. Against the kiwi it was NZ$1.6342 EURNZD=R after plumbing a three-month low of NZ$1.6195.

Improved risk sentiment saw the Aussie extends gains against the safe-haven yen to 93.52 AUDJPY=R , while the kiwi was just below a six-year high at 87.24 NZDJPY=R .

Against the U.S. dollar, the New Zealand dollar NZD=D4 was in a holding pattern around $0.8480 after it had bounded to a five-month high of $0.8504 overnight.

The kiwi is well-supported before next week's central bank statement, which is expected to announce the raising of rates to choke off growing inflation pressures in the strongly-growing economy. Href="NewsSearch">NZ/POLL

Near-term support is seen at $0.8430, with resistance at Thursday's high and then $0.8550.

New Zealand government bonds 0#NZTSY= were softer, sending yields 4 basis points higher.

Australian government bond futures were also weaker, with the three-year bond contract YTTc1 off 5 ticks at 96.980. The 10-year contract lost 7.5 points to 95.880.

(Editing by Eric Meijer)

((Gyles.Beckford@thomsonreuters.com)(+64 4 802 7977)(Reuters Messaging: gyles.beckford.reuters.com@reuters.net))

Keywords: MARKETS AUSTRALIA/FOREX

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