SYDNEY, Jan 17 (Reuters) – The Australian and New
Zealand dollars were little moved by better-than-expected China
economic data on Tuesday as traders, who have priced in China
reopening surprises, looked past backward-looking figures.
The Aussie was hovering at $0.6974 on Monday, after
briefly breaking above 70 cents for the first time since August
in the previous session. It now faces resistance at yesterday’s
top of $0.7019.
The kiwi dollar was standing at $0.6406, a touch
below yesterday’s peak of $0.6426, as gains evaporated overnight
amid a stall in global stock markets.
The two currencies, which had benefited by China’s rapid
reopening from COVID lockdowns since December, took in stride
better-than-expected fourth quarter economic data from China.
The world’s second largest economy expanded at 2.9% in the
fourth quarter from a year earlier, beating market expectations
of a 1.8% gain. For the whole of 2022, growth stood at 3%.
Barrenjoey chief macro strategist Damien Boey said the data
did not corroborate what had been suggested by underwhelming
leading indicators such as the Purchasing Managers’ Index and
lending data.
“And the other side is that …. the market is kind of due
for a bit of a pause or a breather, it needs to get real
confirmation and then some of the recoveries (happening) in
order to solidify that,” he said.
“Even if they’re really positive, a lot of the positivity
has already gone into the asset prices that are exposed to
China.”
Domestically, a survey by Westpac-Melbourne Institute
released on Tuesday showed Australia’s consumer mood brightened
for the second month in a row in January, as a break in a
painful cycle of interest rate rises likely provided temporary
relief for borrowers.
However, the local market also favours a quarter-point hike
from the Reserve Bank of Australia (RBA) to 3.35% in February,
with some chance it may pause for the first meeting since May.
Yields on Australian government bonds remained steady,
although not far away from one-month lows hit last week.
The yield on 10-year bonds stood at 3.611%, and the yield on
three-year notes sat at 3.195%.
(Reporting by Stella Qiu; Editing by Jamie Freed)
