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Australian Dollar Strengthens On Better-than-expected Trade Data

The Australian dollar climbed against other major currencies in the early Asian session on Wednesday, as a report showed that country's trade surplus exceeded economists forecast in May.

The latest data from the Australian Bureau of Statistics showed that Australia reported a seasonally adjusted merchandise trade surplus of A$670 million in May

That blew away forecasts for a surplus of A$53 million following the upwardly revised A$171 million surplus in April.

Exports were up a seasonally adjusted 4.0 percent on month to A$26.444 billion, while imports added 2.0 percent on month to A$25.774 billion.

A separate report showed that country's retail sales were up a seasonally adjusted 0.1 percent on month in May, standing at A$21.825 billion.

That missed forecasts for an increase of 0.3 percent following the downwardly revised 0.1 percent contraction in April.

The aussie reached as high as 0.9192 against the greenback, up from Wednesday's closing quote of 0.9146. The aussie may eye next resistance around the 0.925 level.

The aussie hit 92.45 against the yen for the first time since June 14. The next probable resistance for the aussie lies around the 93.00 level.

The aussie appreciated to a 2-day high of 1.4123 against the European currency, reversing from Monday's weekly low of 1.4281. If the aussie extends its uptrend, it may seek resistance surrounding around the 1.40 level.

The aussie advanced to 1.1826 against the kiwi after the release of the data, adding 0.5 percent from a 12-day low of 1.1765 hit yesterday. On the upside, the aussie is likely to face resistance around the 1.193 level.

The aussie that closed Tuesday's trading at 0.9644 against the loonie climbed to 0.9677. Further uptrend for the aussie may lead it to find resistance around the 0.971 level.

Looking ahead, PMIs from major European economies and Eurozone retail sales for May are due for release in the European session.

The U.S. ADP employment report for June, trade data for May and weekly jobless claims for the week ended June 29, as well as Canada trade data for May are likely to influence trading in the New York session.

by RTTNews Staff Writer

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