CANBERA (dpa-AFX) - The New Zealand dollar was the clear outperforming major currency on Friday in Asia, braced by a rally in commodities as the European Central Bank on Thursday cut its key interest rate to a record low.
Following its monetary policy meeting, the Governing Council led by ECB President Mario Draghi reduced the main refinancing rate by 25 basis points to 0.50 percent.
'The cut in interest rates should contribute to support prospects for a recovery later in the year,' Draghi said. 'Against this overall background, our monetary policy stance will remain accommodative for as long as needed.'
Upbeat U.S. jobs data also generated positive sentiment, with the Labor Department releasing a report showing that initial jobless claims unexpectedly fell to a five-year low in the week ended April 27th.
Initial jobless claims fell to 324,000, a decrease of 18,000 from the previous week's revised figure of 342,000. The drop in came as a surprise to economists, who had expected claims to edge up to 345,000 from the 339,000 originally reported for the previous week.
With the unexpected decrease, jobless claims fell to their lowest level since hitting 321,000 in the week ended January 19, 2008.
Activity in Australia's non-manufacturing sector tailed off sharply last month, its biggest decline since April 2012. The Performance of Services Index from the Australian Industry Group and The Commonwealth Bank of Australia registered 44.1 for April compared to 49.6 in March. Readings below 50.0 indicate contraction of activity in the measured sector.
Final demand producer prices in Australia were up 0.3 percent in the first quarter of 2013 compared to the previous three months, the Australian Bureau of Statistics said today. That followed the 0.2 percent increase in the fourth quarter of 2012. On a yearly basis, final demand producer prices added 1.6 percent after rising 1.0 percent in the three months prior.
The New Zealand dollar climbed to a 2-day high of 83.56 against the yen, up almost 0.5 percent from Thursday's close of 83.17. With the NZD/JPY pair failing to pierce the 82.0 support level, the pair may extend uptrend beyond the 84.0 level in the near-term.
Against the US dollar, the New Zealand currency advanced to a 2-day high of 0.8528, adding almost 0.4 percent from yesterday's close of 0.8495. A hammer formation in yesterday's candle suggested further bull run into the pair, with 0.8560/70 resistance likely to be broken.
The NZ dollar rose to a 3-day high of 1.5327 against the euro, a 0.3 percent or 50-pips appreciation from yesterday's closing quote of 1.5377. The next bullish barrier for the kiwi dollar is seen around the 1.5250 area.
The New Zealand dollar strengthened to 1.2041 against its Tasman rival on Friday in Asia, rising as much as yesterday's fresh multi-year peak. Probable bearish extension could lead the pair break the 1.20 barrier in the near-term as the next support area for the AUD/NZD currency cross is visible around the 1.1930 area.
Looking ahead, the eurozone producer price index for March is due out in the European session.
Besides the closely watched U.S. non-farm payrolls data, the North American session will get some macroeconomic boost from a couple of data on the U.S. factory orders for March and the ISM non-manufacturing composite index for April.
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