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Commodity Currencies Rise On Strong China PMI Data

Commodity currencies such as the Australian, the New Zealand and the Canadian dollars strengthened against their major counterparts in the Asian session on Friday, after the manufacturing sector in China continued to expand in June, and at a faster pace.

Data from the National Bureau of Statistics showed a manufacturing PMI score of 51.7, beating forecasts of 51.0, and it's up from 51.2 in May.

The bureau also said that its non-manufacturing PMI came in with a score of 54.9, up from 54.5 in the previous month.

Meanwhile, the Australian dollar traded higher, aided by a rebound in iron ore price.

In other economic news, data from the Reserve Bank of Australia showed that total credit to the private sector credit climbed a seasonally adjusted 0.4 percent month-over-month in May, the same rate of rise as in April. The figure also matched consensus estimate. On an annual basis, credit grew 5.0 percent in May compared to a 6.4 percent increase in the same month of 2016.

Data from Statistics New Zealand showed that the total number of building permits issued in New Zealand climbed a seasonally adjusted 7.0 percent on month in May, at 2,794. That followed the 7.6 percent contraction in April.

In the Asian trading, the Australian dollar rose to a 3-day high of 1.4822 against the euro, from yesterday's closing value of 1.4889. The aussie may test resistance around the 1.44 region.

Against the U.S. and the Canadian dollars, the aussie advanced to more than a 3-month high of 0.7712 and a 2-day high of 1.0009 from yesterday's closing quotes of 0.7682 and 0.9989, respectively. If the aussie extends its uptrend, it is likely to find resistance around 0.78 against the greenback and 1.01 against the loonie.

Against the yen, the aussie edged up to 86.35 from yesterday's closing value of 86.17. On the upside, 88.00 is seen as the next resistance level for the aussie.

The NZ dollar rose to a 3-day high of 0.7336 against the U.S. dollar, from yesterday's closing value of 0.7298. The kiwi may test resistance around the 0.74 region.

Against the yen, the euro and the NZ dollar, the kiwi advanced to 82.09, 1.5591 and 1.0495 from yesterday's closing quotes of 81.83, 1.5673 and 1.0526, respectively. If the kiwi extends its uptrend, it is likely to find resistance around 83.00 against the yen, 1.51 against the euro and 1.03 against the aussie.

The Canadian dollar rose to a 6-month high of 1.2972 against the U.S. dollar, from yesterday's closing value of 1.2999. The loonie is likely to find resistance around the 1.28 region.

Against the euro and the yen, the loonie advanced to 1.4831 and 86.35 from yesterday's closing quotes of 1.4872 and 86.21, respectively. If the loonie extends its uptrend, it may find resistance around 1.45 against the euro and 88.00 against the yen.

Looking ahead, German unemployment rate for June, U.K. GDP data for the first quarter and Eurozone CPI data for June are due to be released later in the day.

In the New York session, Canada industrial and raw materials price indices for May, Canada GDP data for April, U.S. personal income and spending data for May, U.S. Chicago PMI data for June, U.S. University of Michigan's consumer sentiment index for June and U.S. Baker Hughes rig count data are slated for release.

At 7:30 am ET, ECB board member Sabine Lautenschlager will give a speech at "Mittagsgesprach" organized by the Institute for European Policy in Berlin.

At 10:30 am ET, Bank of Canada will publish business outlook survey reports.

Later in the day, ECB Excecutive board member Benoit Coeure gives a speech at CompNet's 13th annual conference on "Innovation, firm size, productivity and imbalances in the age of de-globalization" in Brussels, Belgium.

by RTTNews Staff Writer

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