The Australian and New Zealand dollars were enjoying a much-needed bounce on Friday, courtesy of a lull in the Sino-US trade tussle and a sharp reversal in the formerly safe-haven yen. The latest trade figures from China were mixed but suggested the threat of tariffs had not had a big impact as yet with exports beating forecasts in June.
The Aussie dollar clawed its way up to $0.7415, from a $0.7360 low on Thursday, and was aiming to end a rough week with only a marginal loss. Days of seesaw trading has left clear boundaries at the recent trough of $0.7311 and the top of $0.7484. It got a hand up against the yen with investors seemingly seeing it as less of a safe harbour when it comes to possible trade wars given Japan's heavy reliance on exports.
The Aussie hit a one-month high at 83.60 yen, taking it well away from the recent trough at 80.58. It now faces major resistance around 84.50, which marks a triple top from March, May and June. The New Zealand dollar was hovering at $0.6778, after finding some support around $0.6748 overnight. That still left it down 0.9 percent for the week.
New Zealand government bonds gained, sending yields 0.7 basis points lower towarrds the long end of the curve Australian government bond futures were little changed, with the three-year bond contract off 1 tick at 97.925 and the 10-year contract steady at 97.3650.
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