SYDNEY, April 30 (Reuters) – The Australian and New Zealand dollars are set for another week of gains on Friday, led by stronger commodity prices with iron ore rising more than 30% in the past month and copper at its highest decade.
Prices of soft commodities and food have also risen in recent days, particularly benefiting the kiwi dollar.
The Australian dollar is last at $ 0.7774 with the next chart resistance seen at $ 0.7820. Critical chart support lies at $ 0.7699.
The Aussie is up 0.4% so far for the week, on track for its fourth consecutive weekly gain. That jumped 2.4% in April alone.
The New Zealand dollar was at $ 0.7247, not too far from the two-month high of $ 0.7286 reached on Thursday.
The kiwi is up 0.7% so far this week, set for the fifth consecutive weekly gain. So far it has risen 3.8% in April.
Analysts said the combination of strong commodity prices and a weak US dollar has driven the antipodean currency. Iron ore is Australia’s main export while New Zealand is the world’s leading supplier of dairy products.
Investors ‘attention will turn to the Reserve Bank of Australia (RBA)’ s May policy meeting on Tuesday where it is widely expected to keep interest rates at a record low of 0.1%.
Next Friday, the RBA will present its quarterly economic outlook, “which will formalize strength in labor market conditions through an increase in the unemployment rate forecast,” ANZ economists said in a note.
Australia’s federal budget is due a week later, on May 11, and is expected to show a rapid increase in the country’s fiscal position.
The only policy event on the New Zealand calendar scheduled for next week is the country’s central bank’s Financial Stability Report.
“Given this backdrop, our bias is for some modest upside movement in AUD / NZD towards the top of the 2021 trading range,” added the ANZ economist.
The Aussie is last at $ 1.0729 against the kiwi, down from a six-month high of $ 1.0946 hit last month.
“The intersection of the 100 and 200 day moving averages at 1.0750 looks to be a pretty good entry level,” they said.
New Zealand government bonds sold out, sending yields about 3-4 basis points higher along the end of the curve.
Australian government futures also slipped, with the three-year bond contract down 1 tick at 99.73. The 10-year contract fell 3.5 ticks to 98.295. (Reporting by Swati Pandey; Editing by Muralikumar Anantharaman)