The Australian and New Zealand dollars rallied on Thursday after upbeat domestic economic data badly wrongfooted bears betting on weakness and lengthened the odds on lower interest rates in both countries. The Aussie hit a three-week peak of $0.7169, having been as low as $0.7057 on Wednesday when speculators shorted the currency in anticipation of weak job numbers. The song was much the same for the kiwi, which shot to the highest in seven weeks at $0.6935 and well away from Wednesday's trough at $0.6828.
In the debt market, yields were still 3 to 4 basis points lower thanks to the major rally in global bonds triggered by the Fed overnight. Australian government bond futures turned mixed, with the three-year bond contract off 1 tick at 98.550. The 10-year contract was still up 3 ticks at 98.0900.
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