News Column

Australian And NZ Dollars Climb As China Manufacturing PMI Hits 7-month High

June 22, 2014



CANBERA (Alliance News) - The Australian and NZ dollars strengthened against the other major currencies in the Asian session on Monday after data showed that HSBC manufacturing PMI for China climbed to a 7-month high in June.

Data from Markit economics and HSBC showed that China flash PMI rose to a 7-month high of 50.8 in June, up from 49.4 in May.

The output index advanced to a 7-month high of 51.8 in June, up from 49.8 in May.

Asian stock markets firmed on the China news, while fresh highs on Wall Street also fueled appetite for riskier assets. Crude oil held near nine-month highs as violence in Iraq intensified.

Witnesses and security sources said that Sunni militants seized three towns in Iraq's western Anbar province on Sunday to evict Iraqi security forces from Sunni Muslim areas.

The Australian dollar rose to a 2-1/2-month high of 0.9442 against the US dollar, from an early multi-day low of 0.9368. The pair was quoted at 0.9381 at last week's close. On the upside, 0.95 is seen as next resistance level for the aussie.

The aussie advanced to a 1-week high of 1.4401 against the euro, from a multi-day low of 1.4496. At last week's close, the aussie was trading at 0.9381 against the greenback and 1.4480 against the euro. The aussie may test resistance near the 1.43 zone. The Australian dollar which ended last week's deals at 95.71 against the yen strengthened to 96.23 for the first time since April 4. If the aussie extends it uptrend, it is likely to find resistance around the 97.21 area.

An index monitoring the manufacturing sector in Japan came in with a score of 51.1 in June, the latest survey from Markit Economics revealed - up from 49.9 in May. That pushes the index into expansionary territory, as a score above 50 signals growth in the sector while a reading below means contraction.

Against the Canadian dollar, the aussie climbed to 1.0139 from an early multi-week low of 1.0075. The pair was quoted at 1.0090 at last week's close. If the aussie continues its uptrend, it is likely to find resistance around the 1.02 region.

Having fallen to an early multi-day low of 1.0757 against the NZ dollar, the aussie advanced to a 6-day high of 1.0815 . At last week's close, the aussie was trading at 1.0781.The next possible upside target for the aussie-kiwi pair lies around the 1.08 level.

The NZ dollar appreciated to a 1-1/2-month high of 89.06 against the yen from last week's closing quote of 88.68. The next possible upside target for the kiwi-yen pair lies around the 90.21 level.

Against the US dollar, the kiwi rose to a 1-1/2-month high of 0.8735 from last week's closing quote of 0.8689. The next possible upside target level of the kiwi is seen at 0.88 area.

The NZ dollar rose to a 4-day high of 1.5569 against the euro, from last week's closing quote of 1.5622. The next possible upside target level of the kiwi is seen at 1.54 zone.

Looking ahead, At 2:00 am ET, the Bank of Japan Governor Haruhiko Kuroda will deliver a speech at the 2014 Japan Association of Corporate Executive Members' meeting in Tokyo.

In the European session, June private sector activity data for major Eurozone nations are due to be released by Markit Economics.

In the New York Session, Markit's USmanufacturing PMI for June and existing home sales for May are due to be released.



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Source: Alliance News


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