Euro holds gains, kiwi jumps on solid jobs data
SYDNEY (Reuters) - The euro held near a one-week high against the dollar and two-month peaks on its Australian counterpart in early Asian trade on Thursday, having risen broadly after upbeat German factory activity data bolstered sentiment.
Investors also snapped up the New Zealand dollar in the wake of a surprisingly strong jobs report at home, driving the kiwi up more than half a U.S. cent to a high of $0.8470.
The euro traded at $1.3158, after rising as far as $1.3195 overnight. Initial resistance is seen around the May 1 peak of $1.3243, with a break there taking it back to levels not seen since February.
Investors warmed to the common currency after German industrial output unexpectedly jumped in March, fanning hopes that Europe's top economy is gaining traction.
"The single currency has perhaps been the biggest beneficiary of the improving economic data out of Germany," said Stan Shamu, market strategist at IGMarkets.
"When ECB President Mario Draghi cut rates last week, he emphasised the ECB is ready to do more should economic data continue to deteriorate. As a result, the German data saw EUR/USD spike to $1.3195."
The move also came after a European Central Bank Executive Board member said the bank was not a "toothless tiger" and still had tools to deploy should the euro zone continue to worsen after last week's cut in interest rates to a record low.
The euro's bounce saw the dollar index .DXY erase gains, putting it on track to end the week down 0.2 percent. Against the yen, the common currency hit a three-week high at 130.43.
The euro's performance against the downtrodden Australian dollar was even more dramatic. It shot up to a 2-1/2 month high of A$1.2948, before giving back a bit of ground to last stand at A$1.2909.
The Aussie is also on track to fall over 1 percent versus the greenback this week, having suffered broadly after the Reserve Bank of Australia cut its cash rate to a record low 2.75 percent and left the door open to more easing.
It was last at $1.0175, well off this week's high of $1.0310. Initial support is seen around $1.0155, where demand has emerged in the previous two sessions.
The Aussie's near-term focus is local employment data due 0130 GMT (0930 EST) and an inflation report out of China, Australia's single biggest export market. Any disappointment in these figures will no doubt pile on more pressure on the currency.
In contrast, the kiwi was given a respite after upbeat data showed a record rise in employment that pushed the jobless rate to a three-year low.
It was up half a U.S. cent at $0.8450, pulling well away from a trough of $0.8360 plumbed on Wednesday after the head of country's central bank admitted the bank had intervened to cap what it viewed as an overvalued currency.
(Editing by Wayne Cole)
- Tweet this
- Share this
- Digg this
Up to 150 people were feared trapped by a landslide triggered by heavy rains in Maharashtra on Wednesday, the inspector general of the national disaster force told Reuters, saying that the first batch of emergency workers had arrived at the scene. Full Article