The Australian dollar recovered from its early lows against the other major currencies in the Asian session on Tuesday following the release of a report showing an increase in Australia’s business sentiment in June.
A survey by the National Australia Bank showed that Australian business confidence improved in June, although conditions remained sub-trend.
The NAB business confidence index increased to 8 in June from 7 in May despite the government’s challenging new budget. This improvement was driven by strengthened confidence in almost all the industries, with the surge in construction industry confidence contributing the most.
The business conditions index increased to 2 in June from -1 in May, ending the negative trend that started in the beginning of the year. Sales and profits were stronger in June while employment remained weak.
The Australian dollar rose to 5-day highs of 0.9395 against the U.S. dollar, 1.4481 against the euro and 1.0034 against the Canadian dollar, from early lows of 0.9364, 1.4526 and 1.0003, respectively. At yesterday’s close, the aussie was trading at 0.9370 against the greenback, 1.4513 against the euro and 1.0009 against the loonie. If the aussie extends its uptrend, it is likely to find the resistance around 0.95 against the greenback, 1.43 against the euro and 1.01 against the Canadian dollar.
Against the yen, the aussie climbed to 95.56 from an early low of 95.33. The pair was quoted at 95.45 at yesterday’s close. The aussie may find resistance near the 96.53 region.
The Ministry of Finance said that Japan posted a current account surplus of 522.8 billion yen in May – remaining in the black for the fourth straight month. The headline figure topped forecasts for a surplus of 429.9 billion yen, and was up from 187.4 billion yen in April.
Looking ahead, Japan economy watchers survey for June is due at 1:00 am ET.
In the European session, German current account and trade data for May, Switzerland’s inflation report for June and U.K. industrial production for May are due to be released.
Ai 3:00 am ET, European Union’s finance ministers meeting will be held in Brussels.
The U.S. consumer credit for May is set to be released in the New York session.
At 1:45 pm ET, Minneapolis Fed president and Chief executive officer Narayana Kocherlakota will deliver a speech on Monetary Policy in Minneapolis.