CANBERA (dpa-AFX) - The New Zealand dollar strengthened against other major currencies in the Asian session on Thursday, as Asian stock markets traded higher amid renewed optimism about a potential peace deal between the U.S. and Iran after U.S. President Trump said the U.S. was in the final stages of negotiations with Iran. Tumbling crude oil prices on hopes of the reopening of the Strait of Hormuz also eased global inflationary pressures.
Saudi Arabia's state news agency Al-Hadath reported that Pakistan could announce the final draft of a peace deal between the U.S. and Iran and added that intensive work is underway to finalize the text of agreement.
The IRGC stated that 26 ships, which coordinated with the Iranian authorities, were let to pass through the Strait of Hormuz over the past 24 hours.
The Middle East conflict entered day number 83 today, leaving the Strait of Hormuz effectively closed. A third of the world's fertilizer supply passing through the strait has halted and the U.N. Food and Agriculture Organization warned that this could trigger a severe global food price crisis.
In economics news, data from Statistics New Zealand showed that New Zealand posted a merchandise trade surplus of NZ$1.920 billion in April. That blew away expectations for s surplus of NZ$980 million following the downwardly revised NZ$430 million surplus in March.
Exports came in at NZ$8.62 billion, up from the downwardly revised NZ$7.66 billion in the previous month. Imports were at NZ$6.70 billion, down from the downwardly revised NZ$7.23 billion a month earlier.
The Reserve Bank of New Zealand (RBNZ) has maintained a cautious attitude on additional policy tightening due to recent indications of weakening domestic economic momentum. Policymakers are reluctant to suppress the fragile recovery because the domestic economy has just recently emerged from a recession and still has a large amount of spare capacity.
In the Asian trading today, the NZ dollar rose to a 9-day high of 1.2136 against the Australian dollar, from yesterday's closing value of 1.2186. If the kiwi extends its uptrend, it is likely to find resistance around the 1.20 region.
In economic news, the manufacturing sector in Australia continued to expand in May, albeit at a slower pace, the latest survey from S&P Global revealed on Thursday with a manufacturing PMI score of 50.2. That's down from 51.3 in April, although it remains above the boom-or-bust line of 50 that separates expansion from contraction. The survey also showed that the services PMI fell to 47.7 in May from 50.7 in April, while composite PMI dropped to 47.8 from 50.4.
Meanwhile, Australia's seasonally adjusted unemployment rate increased to 4.5 percent in April, above both the previous month and market expectations of 4.3 percent. It was the highest level since last September. The number of unemployed rose by 33,000 to 692,500 from 659,500 in March. Employment unexpectedly fell by 18,600 to 14.74 million, defying estimates for a 17,500 increase.
Against the U.S. dollar, the yen and the euro, the kiwi advanced to 0.5875, 93.31 and 1.9804 from Wednesday's closing quotes of 0.5868, 93.23 and 1.9813, respectively. The kiwi may test resistance around 0.60 against the greenback, 95.00 against the yen and 1.95 against the kiwi.
Looking ahead, Eurozone construction output for March and labour cost index for the first quarter are slated for release in the European session.
In the New York session, U.S. building permits for April, housing starts for April, weekly jobless claims data, U.S. Philly Fed Capex index for May, U.S. S&P Global PMI for May, U.S. flash consumer confidence for May and U.S. Kansas Fed manufacturing index for May are slated for release.
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