By Anjli Raval
Published: January 5 2010 11:47 | Last updated: January 5 2010 11:47
The New Zealand dollar traded near 6-week highs against the US dollar, buoyed by a surge in risk appetite on Tuesday and renewed hopes on an economic recovery.
The Kiwi dollar advanced 0.2 per cent against the US dollar to $0.7353 after reaching a high of $0.7366 in early trade.
The Australian dollar hit a 3-week high after firm commodity and equity prices gave the currency a lift against a softer US dollar. Building on a sharp 1.7 per cent jump in overnight trade, the Aussie dollar reached a peak of $0.9163 in early trade before curtailing gains. The currency rose 0.1 per cent against the US dollar to $0.9136.
The Canadian dollar extended Monday’s gains, adding 0.4 per cent versus the US dollar to C$1.0383 while the South African rand
The US dollar remained under selling pressure as investors continued to favour riskier assets and the market awaited US employment data released on Friday.
The US currency slipped broadly despite data released on Monday showing that US factories marked their best month in nearly four years. The payrolls numbers, due on Friday, are used by many investors to determine the direction of the dollar.
Versus the yen, the dollar fell 0.4 per cent to Y92.13 extending Monday’s losses.The dollar index which tracks its performance against a basket of currencies, slid 0.2 per cent to 77.365.
The dollar however pared losses, helped by weaker European shares. The euro gained 0.1 per cent against the dollar to $1.4420.
Sterling fell 0.5 per cent against the dollar to $1.6008 and slipped 0.5 percent against the euro to £0.9001 amid concerns over how the UK will tackle its ballooning fiscal deficit and as investors turn their attention to the UK general elections in the coming months.
Stephen Pope, strategist at Cantor Fitzgerald said data showed “sterling set to fall toward a three-month low against the dollar, as it is close to forming a so-called “Dead Cross” trading pattern,” opening scope for renewed downside.
“The Dead Cross emerges when the short term moving average breaks downward below the curve of the longer term moving average, which indicates the end of the up trend and the start of the new down trend.”
