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Dollar higher on trade data
Posted on 2010-06-03
THE dollar was higher at noon as investors continued to move into risk assets on the release of strong domestic trade data.
At noon (AEST) today, the dollar was trading at $US0.8453/55 up 1.45 per cent from yesterday's close of $US0.8331/33.
From 7am(AEST) today,the local unit traded between $US0.8412 and $US0.8467.
RBC Capital markets senior economist Su-Lin Ong said the local currency moved upwards on the trade data.
"The Australian currency is faring modestly higher on the back of it," she said.
"There's a lot of other stuff going on at the moment, but these are definitely Aussie dollar supportive numbers."
Ms Ong said the data supported a favourable theme of risk asset acquisition.
The
Australian balance of goods and services was a surplus of $134 million
in April, seasonally adjusted, from a downwardly revised deficit of
$2.040 billion in March, the Australian Bureau of Statistics (ABS) said
today.
It's the first monthly trade surplus in just over a year as exports soared 11 per cent in April.
The local unit opened strongly after positive performance in equities overnight.
Overnight the US stock market rebounded after a jump in pending home sales raised optimism about the economy.
The
gains yesterday allowed stocks to recover the losses from the day
before, when the government announced investigations into the Gulf oil
spill.
A rebound in energy stocks led the way.
Ms Ong said the acceleration in the terms of trade would provide a likely boost to income and demand.
"It is going to remain comfortably in surplus for the remainder of this year," she said.
She expects the local currency to strengthen in afternoon trade.
Meanwhile, the bond market was weaker at noon.
At
noon (AEST), the yield on the Commonwealth Government April 2020 bond
was 5.415 per cent, up from yesterday's close of 5.337 per cent, while
the May 2013 bond was at 4.761 per cent, up from 4.681 per cent.
On
the Sydney Futures Exchange, the June 10-year bond futures contract was
at 94.585, down from yesterday's close of 94.670, while the June
three-year bond futures contract was 95.180, down from yesterday's
close of 95.260.
Source: The Daily Telegraph
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