Reuters Australia
Aussie dollar slips vs USD, gains on kiwi and yen
Friday July 18, 11:52 AM
SYDNEY, July 18 (Reuters) - The Australian dollar slipped against a rebounding U.S. dollar on Friday, with lower commodities also pulling it down, but improved risk appetite and hefty rate differentials were seen limiting its losses.
* The Aussie moved to near seven-year highs against the kiwi, the latter hurt by growing expectations the Reserve Bank of New Zealand would cut interest rates next week. In contrast, an ugly second-quarter inflation number in Australia next week could see markets discount the chance of a local rate cut.
* The Aussie inched up to 103.25 yen AUDJPY=R from 102.63 yen late here on Thursday as higher stock markets on Wall Street encouraged demand for leveraged carry trades. Shares rose, aided by falling oil prices, although the rally could fizzle out amid disappointing earnings from some blue-chip U.S. companies.
* By 9:30 a.m. the Aussie AUD= was at $0.9722/26 against the U.S. dollar, down from $0.9768/72 late here on Thursday. It struck a 25-year high of $0.9851 earlier this week, but has fallen since as the U.S. dollar recovered, commodity prices took a hit and the central bank governor made dovish comments.
* Reserve Bank of Australia (RBA) Governor Glenn Stevens in a speech on Wednesday indicated rates had probably peaked, stoking market talk a rate cut might be on the horizon.
* Financial markets are pricing in a 40 percent chance of a cut in the next 12 months, but analysts are more cautious, noting Stevens also pointed to the booming terms of trade which could provide a huge boost to the economy.
* Data later on Friday could give further evidence of that. The government releases second-quarter import and export price indices. Export prices are forecast to show a 10 percent jump in the second quarter, boosted by strong demand for the country's iron ore and coal exports.
* The CRB index .CRB of leading commodities fell 2.7 percent to 432.60 points on Thursday, after oil slid and gold prices eased. Australia is a big exporter of natural resources.
* Australian bonds came under pressure as investors veered towards riskier assets on easing credit worries. They tailed U.S. Treasuries which were also hurt by an unexpected rise in U.S. housing starts in June.
* Three-year Australian bond futures YTTc1 fell 0.025 points to 93.555, while the 10-year bond contract YTCc1 lost 0.045 points to 93.66. (Reporting by Anirban Nag; Editing by James Thornhill)
Next Article: Qantas cuts 4% of workforce, prunes growth plan
Previous article: Hit by tax probe, UBS halts U.S. offshore services
Top Headlines
Australia Market Report of September 2: Downward Rate Move Expected to Continue
Tuesday September 2, 12:36 PM - Asia Business News
Sydney, Australia, Sept 2, 2008 - (ABN Newswire) - Yesterday, the Australian share market closed slightly lower following we .. Read More
Financial markets
Tuesday September 2, 12:20 PM - Newstalk ZB
To the markets where the NZX50 is up 12 points to 3,369. .. Read More
Zamia Gold Mines Limited's (ASX:ZGM) Anthony Molybdenum Discovery Expands Mineralisation And Project Potential
Tuesday September 2, 12:19 PM - Asia Business News
Brisbane, Australia, Sept 2, 2008 - (ABN Newswire) - Zamia Gold Mines Limited's (ASX:ZGM) diamond drill program at its Antho .. Read More
Calculators
Copyright © 2008 Yahoo! All rights reserved.
Yahoo!Xtra: A Yahoo!7/Telecom New Zealand Company.