By TraderVox.com
Tradervox (Dublin) – The Australian dollar rose against most majors after the labor department published a report showing that unemployment unexpectedly increased in the May. The positive employment data has reduced bets that Reserve Bank will make additional interest rate cut after it reduced interest rate by 0.25 this week.
The New Zealand dollar remained high against the US dollar after it gained yesterday following speculation that Fed Chairman Ben Bernanke will support sentiments that US economy may require additional stimulus. Positive sentiments from the G7 meeting and Mario Draghi have dismissed fears in the market boosting demand for riskier assets.
At the heat of the debt crisis in Europe, south pacific currencies have occasionally encountered excessive losses; but the recent data from the euro region and positive data from the Australian government has led to strengthening of the dollar are investors are comfortable taking buying into riskier assets. South pacific Stocks have also increased adding 1.6 percent which has boosted appetite for higher-yielding assets. The labor department report showed an increase in the Australian Payrolls by 38,900 last month against marketing expectation of zero gain. However, the unemployment rate rose to 5.1 percent from 5 percent registered in April.
This report came a day after a report was publish yesterday showing that Australian Gross Domestic Product grew by 1.3 percent in the first quarter. Economists had predicted the expansion rate to be half as strong. These positive data have propelled the Aussie to the fourth-day increase against major currencies. This increase will be bolstered by any positive news from the euro region.
After the job report was released, the Australian dollar rose by 0.2 percent against the dollar to trade at 99.44 US cents during mid-day trading in Sydney today after it had earlier fallen by as much as 0.5 percent. The New Zealand currency was little changed at 77.03 from 77.08 US cents. Both south pacific dollars had increased by 1.9 percent yesterday which is the most since November 30.
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