The Australian dollar continued to be strong against the other major currencies in the Asian session on Thursday amid risk appetite, tracking the gains on Wall Street overnight and in the European markets. The rebound in crude oil and gold prices also boosted sentiment.
Meanwhile, investors are bracing for the crucial U.S. Federal Reserve decision later in the day to see whether the U.S. central bank would raise short-term interest rates for the first time in nearly a decade.
While some analysts remain split on whether the Fed will raise rates, a Labor Department report showing tame inflation may have provided further support for the view that the central bank will leave rates at record lows.
A U.S. Labor Department report overnight showing tame inflation may have provided further support for the view that the central bank will leave rates at record lows.
Wednesday, the Australian dollar rose 0.46 percent against the U.S. dollar, 0.60 percent against the yen, 0.56 percent against the euro, 0.06 percent against the Canadian dollar and 0.22 percent against the NZ dollar.
In the Asian trading, the Australian dollar rose to near 4-week highs of 0.7207 against the U.S. dollar and 1.1347 against the NZ dollar, from yesterday’s closing quotes of 0.7196 and 1.1299, respectively. If the aussie extends its uptrend, it is likely to find resistance around 0.73 against the greenback and 1.14 against the kiwi.
Against the yen, the aussie advanced to nearly a 3-week high of 86.95 from yesterday’s closing value of 86.75. On the upside, 90.00 is seen as the next resistance level for the aussie.
The aussie edged up to 1.5667 against the euro and 0.9493 against the Canadian dollar, from yesterday’s closing quotes of 1.5686 and 0.9475, respectively. The aussie may test resistance level around 1.52 against the euro and 0.96 against the loonie.
Looking ahead, Swiss SECO economic forecasts for September is due to be released at 1:45 am ET.
At 2:35 am ET, Bank of Japan Governor Haruhiko Kuroda is expected to speak at the National Securities Industry Convention in Tokyo.
In the European session, European Central Bank’s monthly economic bulletin, U.K. retail sales data for August and Eurozone construction orders for July are set to be announced.
At 3:30 am ET, the Swiss National Bank’s interest rate announcement is due. The central bank is expected to maintain the LIBOR rate at -0.75 percent.
In the New York session, U.S. building permits and housing starts, both for August, U.S. weekly jobless claims for the week ended September 12 and U.S. Federal Reserve Bank of Philadelphia’s manufacturing index for September are slated for release.
At 2:00 pm ET, the Federal Reserve will announce its decision on monetary policy. The Fed is expected to hold rates at 0.25 percent.
Following the announcement, Federal Reserve Chair Janet Yellen will hold the customary post-meeting press conference at 2:30 pm ET.