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$A rises on mixed US data

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Published on: Friday, February 21, 2014

by AAP

The Australian dollar is hovering just under 90 US cents after rising on mixed US data.

At 1200 AEDT, the local unit was trading at 89.92 US cents, up from 89.54 cents on Thursday.

The Australian dollar fell to a one-week low of 89.37 US cents on Thursday after the HSBC's purchasing manager's index (PMI) showed Chinese manufacturing activity had fallen to its lowest level in seven months.

Meanwhile, the US Markit PMI, out overnight, showed that US manufacturing in February jumped to its highest level in almost four years.

However, the Philadelphia Federal Reserve survey, also released overnight, showed that manufacturing activity in the mid-Atlantic states of the US fell in February.

Improved market sentiment pushed the Aussie back up overnight, ANZ senior FX strategist Dan Been said.

"The move overnight was driven by positioning and positive sentiment as the US data printed what was perceived as better than expected and risk assets rallied," Mr Been said.

"Stocks were higher, emerging market currencies were higher and the Aussie got dragged along with the tide."

He said that with no other major data releases to influence the market, the Aussie likely would be range-bound for the rest of the day.

Meanwhile, Australian bond futures prices are weaker.

At 1200 AEDT on Friday, the March 2014 10-year bond futures contract was trading at 95.870 (implying a yield of 4.130 per cent), down from 95.910 (4.090 per cent) on Thursday.

The March 2014 three-year bond futures contract was at 96.960 (3.040 per cent), down from 97.000 (3.000 per cent).


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