The Australian dollar climbed against its major counterparts in the Asian session on Thursday, as risk sentiment improved on solid corporate earnings and on hopes for continued policy support from the European Central Bank to boost the economic recovery.
Robust corporate earnings helped shrug off concerns over the spread of delta virus variant and its impact on the economy.
Investors await the European Central Bank’s monetary policy announcement due later in the day, amid expectations that it will maintain its accommodative stance to support the euro area.
The European Central Bank’s new inflation target and a possible guidance tweak could sway market sentiment.
Survey data from the National Australia Bank showed that Australia’s business conditions rose to a record high in the second quarter, while confidence eased slightly.
The business conditions index rose strongly by 12 points to a record 32 points in the second quarter. Meanwhile, the business confidence index dropped to 17 from 19 in the preceding quarter.
The aussie rose to 3-day highs of 0.7373 against the greenback, 81.21 against the yen and 1.6002 against the euro, coming off from its early lows of 0.7342, 80.86 and 1.6054, respectively. If the aussie rises further, it may find resistance around 0.75 against the greenback, 84 against the yen and 1.56 against the euro.
The aussie reached as high as 0.9273 against the loonie, up from a low of 0.9225 seen at 5:15 pm ET. The aussie may find resistance around the 0.94 level.
The aussie recovered to 1.0588 against the kiwi, after falling to a 5-1/2-month low of 1.0544 at 5:15 pm ET. On the upside, 1.075 is possibly seen as its next resistance level.
Looking ahead, the European Central Bank will announce interest rate decision at 7:45 am ET. The ECB is expected to hold its main refi rate at a record low zero percent and the deposit rate at -0.50 percent.
U.S. weekly jobless claims for the week ended July 17, existing home sales and leading index for June will be published in the New York session.
Eurozone flash consumer sentiment index for July is set for release at 10:00 am ET.
The material has been provided by InstaForex Company – www.instaforex.com
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