By Ashley Smith – The Australian Dollar ended its recent downward trend in today’s Asian and European trading, ahead of Wednesday’s Retail Sales report which is expected to shows February sales rose. The AUD was further boosted be comments made by Reserve Bank of Australia Governor Glenn Stevens hinting at further interest rate hikes. The bank has raised rates at four of its past five meetings.
Benchmark interest rates are 4%in Australia and 2.5% in New Zealand, compared with 0.1% in Japan and as low as zero in the U.S. Higher yields attract investors to the south pacific currency, along with strong economic fundamentals that support tighter monetary policy and higher interest rates. Australia’s currency rose to 91.45 U.S. cents from 90.41 cents last week in New York. It also climbed to 84.54 yen. While the U.S, U.K and Euro-Zone nations continue to exhibit mixed economic data, raising doubts as to the strength and stability of their economic recovery, Australia continues to perform consistently in par or above expectations thus providing strong ground to continued monetary tightening.
The New Zealand Dollar also gained in today’s trading, boosted by equity gains in Asia and Europe and ahead of a report that is expected to show that home building permits rose in February. New Zealand’s Dollar gained to 71.00 U.S. cents from last week and advanced to 65.53 Yen from 65.11 Yen.
Forex Market Analysis provided by Forex Yard.
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