The Aussie dollar has surged to a nine-month high after the chances of a May rate cut slimmed further.
At 0700 AEST on Friday, the local unit was trading at 76.95 US cents, up from 76.54 cents on Thursday.
The Aussie dollar outperformed all major currencies overnight to reach 77.37 US cents, the highest level since July last year.
The Aussie dollar/Kiwi dollar cross also had its strongest one-day rise in more than a month as the two currencies moved in completely opposite directions, BK Asset Management director of FX strategy Kathy Lien says.
‘It could be a reaction to changes in monetary policy expectations by local banks,’ she said.
Australian markets pushed back the prospect of a rate cut to August following a strong local jobs report on Thursday.
‘While Bank of New Zealand, one of the largest in the country, expects the central bank to reduce rates in April and June,’ Ms Lien said.
‘(It) warned that the market is underpricing the chance of April easing.’
Westpac strategist Imre Speizer said the Reserve Bank publishes its Financial Stability Review on Friday.
‘(But) today’s highlight will be the batch of Chinese data, including first quarter gross domestic product and industrial production,’ he said.
At 7am on Friday, 15 April one Aussie dollar was buying:
76.95 US cents, from 76.54 cents on Thursday*
84.18 Japanese yen, from 83.77 yen
68.30 euro cents, from 67.96 euro cents
112.38 New Zealand cents, from 111.97 NZ cents
54.37 British pence, from 54.16 pence
*Currency closes taken at 1700 AEST previous local session
AAP
