The Australian and New Zealand dollars strengthened against other major currencies in early Asian trading on Wednesday as investors were encouraged by a retreat in oil price and some positive economic data.
Light sweet crude for April delivery dropped $2.01 or 1.9 percent to close at $106.55 a barrel on the New York Mercantile Exchange.
In economic news, industrial output in Japan climbed a seasonally adjusted 2.0 percent on month in January, the Ministry of Economy, Trade and Industry said in a preliminary reading. That beat forecasts for an increase of 1.5 percent following the 3.8 percent gain in December.
On an annual basis, industrial production shed 1.2 percent - also topping forecasts for a contraction of 1.6 percent following the decline of 4.3 percent in the previous month.
Meanwhile, industrial production in South Korea declined an annual 2.0 percent in January, Statistics Korea said - falling into the red for the first time in 31 months, although the headline figure was considerably better than forecasts for a contraction of 4.2 percent following the 2.8 percent increase in December.
On a monthly basis, industrial production jumped a seasonally adjusted 3.3 percent after falling 0.9 percent in the previous month.
Data from the Australian Bureau of Statistics showed that retail sales in Australia rose 0.3 percent on a seasonally adjusted monthly basis in January. This was in line with economists' expectations and followed a 0.1 percent fall in December and a relatively unchanged November.
The Australian dollar rose to a 9-day high of 1.0814 against the US dollar and 2-day highs of 1.0749 against the Canadian dollar and 87.16 against the yen. Against the euro, the Aussie climbed to as high as 1.2469.
If the aussie gains further, it may likely target 1.085 against the greenback, 87.5 against the yen, 1.244 against the euro and 1.078 against the loonie.
The NZ dollar also strengthened, hitting as high as 67.90 against the yen, 1.6008 against the euro and 1.2833 against the Aussie.
Against the US dollar, the NZ dollar strengthened to a 9-day high of 0.8423.
The next upside target level for the kiwi is seen at 0.843 against the greenback, 68.4 against the yen, 1.595 against the euro and 1.280 against the aussie.
Looking ahead, Japan's housing starts data for January is due at 12 am ET.
German import price index for January and unemployment rate for February, Swiss KOF leading indicator for February and CPI for January, U.K. mortgage approvals for January and the Eurozone CPI for January are expected in the European session.
Across the Atlantic, the U.S. preliminary estimate of fourth quarter GDP and the results of the Institute of Supply Management-Chicago's business survey for February are due at 8:30 am and 9:45 am ET, respectively.
Federal Reserve Chairman Ben Bernanke is schedule to deliver the FOMC's semi-annual report to the House Financial Services Committee at 10 am ET.
At 2 pm ET, the Federal Reserve is due to release its Beige Book.
Investors also focus on the European Central Bank's long-term refinancing operation due later in the day.
by RTT Staff Writer
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