🐂 Not all bull runs are created equal. November’s AI picks include 5 stocks up +20% eachUnlock Stocks

FOREX-Dollar stays vulnerable, China data eyed

Published 09/10/2009, 08:20 PM
Updated 09/10/2009, 08:24 PM
AUD/USD
-

* Dollar remains near this year's low vs euro

* NZD, AUD stay firm near 1-yr highs vs USD

* China data on output, retail sales awaited

By Satomi Noguchi

TOKYO, Sept 11 (Reuters) - The dollar remained vulnerable on Friday near its lowest level this year against the euro as investors continued to favour other riskier and growth-linked currencies such as the Australian and New Zealand dollars.

Improving economic data and company earnings added to growing investor confidence and kept the New Zealand dollar near its highest since late August last year and sterling close to a one-month peak hit on Thursday.

The Australian dollar slightly lagged other higher-yielding currencies to rise after weaker-than-expected data on employment and retail sales this week cooled expectations for an interest rate hike as early as next month.

But analysts said demand from Asian central banks deversifying their reserves out of the greenback kept providing strong support to the Aussie.

Investors waited to see if a slew of Chinese data due on Friday morning will strengthen economic recovery hopes and encourage investors to buy more riskier assets and currencies by selling the low-yielding U.S. dollar.

"Our trading desk has seen significant flows from central banks buying AUD/USD over the past few days, perhaps in a sign that central banks, particularly those based in Asia, are diversifying their reserve base away from the U.S. dollar," said Riki Polygenis, an economist at ANZ bank in Sydney.

The euro was little changed from late New York trade at $1.4583, after climbing as high as $1.4614 on trading platform EBS the previous day, its highest since December 2008.

The New Zealand dollar was also steady at $0.7031, holding firm near its highest in over a year at $0.7045 struck on Thursday.

The Aussie edged down 0.1 percent to $0.8623, but stayed within sight of $0.8669, the highest since late August 2008, touched this week.

China's industrial production and retail sales figures for August are among data to be released at 0200 GMT that will give an indication whether the pace of economic recovery there is quickening. China is the second-biggest importer of Australian commodity exports behind Japan.

The dollar slipped 0.1 percent against the yen to 91.65 yen after sliding to a seven-month low of 91.41 yen on EBS the day before.

Sterling kept most of its gains made on Thursday after the Bank of England left monetary policy unchanged as expected, countering speculation of further easing. The pound was steady at $1.6655 after hitting a one-month high of $1.6688 on EBS the previous day. (Additional reporting by Anirban Nag in Sydney; Editing by Michael Watson)

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.