The Australian and New Zealand dollars hovered near two-week highs on Friday, bolstered by stronger commodity prices and a positive outlook for global growth, and as the greenback continued its downward spiral. The Australian dollar held at $0.7939, within kissing distance of Thursday's $0.7967 which was the highest since February 2. For the week, the Aussie is set for a solid 1.6 percent gain, after two straight weekly losses.
The New Zealand dollar held near Thursday's high of $0.7411, a level not seen since late January. It was last down 0.2 percent at $0.7398. For the week so far, the kiwi has already risen about 2 percent. Volumes were generally light as many Asian countries were on holiday for the Lunar New Year.
The dollar index, which measures the greenback against a basket of currencies, has fallen every day so far this week and is set for its worst weekly showing since mid-2017. The losses come despite a surge in US Treasury yields as markets brace for three tightenings this year to around 2 percent.
The rate outlook is no longer providing support to the US dollar amid increasing worries about the burgeoning budget and current account deficits in the world's largest economy. New Zealand government bonds rose, sending yields lower about 2 basis points. Australian government bond futures were mixed, with the three-year bond contract off 1 tick to 97.830. The 10-year contract was unchanged at 97.0850.
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