During early Asian deals on Thursday, the Australian dollar showed strength against its major counterparts as regional stocks gained for the fourth straight session today following the gains overnight on Wall Street.
In late morning trades, the benchmark S&P/ASX 200 Index was gaining 23.10 points or 0.64% to 3,632.40 and the broader All Ordinaries Index was advancing 23.70 points or 0.67% to 3,569.90.
Overnight, U.S. stocks closed higher in a volatile session as traders digested better-than-expected economic data on new home sales and durable goods orders, combined with weak demand for a Treasury Department's auction of $34 billion worth of five-year notes that raised concerns about demand for U.S. government debt.
On the economic front, the Conference Board's Leading Economic Index for Australia registered a decline of 0.6% in January and now stands at 111.2. The Board's Coincident Index, which measures current activity, increased 0.6% for the period and currently stands at 13.1.
The organization said the pace of decline in the leading index has picked up in recent months, now falling at the fastest rates since 2000-2001. The Leading index now stands at 111.2, with the base of 100 established in 2004.
Meanwhile, the Reserve Bank of Australia said that the nation's banking system is one of the world's strongest and is well-positioned to weather the global economic crisis. In its semi-annual Financial Stability Review issued today in Sydney, the RBA noted that that while the global financial system continues to experience significant stress, the Australian Banking system has performed well over recent times.
The currencies also strengthened as Rio Tinto Group, the world's third-largest mining company, said metals markets may pull through in the second half of the year. Commodities account for more than half of the nations' exports.
Against the US dollar, the Australian currency traded higher during early Asian deals on Thursday. At 9:55 pm ET, the aussie-dollar pair reached a high of 0.7024, compared to 0.6980 hit late New York Wednesday. If the pair gains further, 0.727 is seen as the next target level. The pair is currently quoted at 0.6989.
The Australian dollar that closed Wednesday's North American session at 1.9471 against the European currency reached a high of 1.9375 at 10:35 pm ET. The next upside target level for the aussie is seen around 1.92.
Against the Japanese yen, the Australian currency edged higher during Thursday's early Asian deals. At 9:50 pm ET, the aussie-yen pair climbed to 68.64, compared to Wednesday's closing value of 68.10. The aussie-yen pair is currently quoted at 68.24 with 70.2 seen as the next target level.
The Australian dollar that closed Wednesday's New York deals at 0.8601 against its Canadian counterpart rose to 0.8633 at 9:25 pm ET. On the upside, 0.876 is seen as the next target level for the aussie. The pair is currently quoted at 0.8604.
Investors are now likely to focus on the European session, in which the German GfK Consumer confidence survey results for April, French consumer confidence indicator for March, Italian business confidence for March and trade balance report for February as well as the euro-zone's seasonally adjusted M3 money supply for February are slated for release.
Across the Atlantic, Atlanta Federal Reserve Bank Dennis Lockhart is scheduled to make remarks on panel on Food, Water, Inflation and Monetary Policy at the Global Interdependence Center's Conference at 5 AM ET.
The Bureau of Economic Analysis is due to release its final fourth quarter GDP report at 8:30 AM ET. The report is likely to show that the U.S. economy contracted by a 6.6% rate in the quarter.
The Labor Department is due to release its customary weekly jobless claims report for the week ended March 21st at 8:30 AM ET on the same day.
Treasury Secretary Timothy Geithner is scheduled to testify on financial regulation reform before House Financial Services Committee in Washington at 10 AM ET.
Dallas Federal Reserve Bank President Richard Fisher is due to speak to students as part of the ninth annual Redefining Investment Strategy Education Forum at the University of Dayton at 12 PM ET.
Richmond Federal Reserve Bank President Jeffrey Lacker is scheduled to be the keynote speaker for the 2009 Economic Outlook Conference and luncheon of the Charleston Metro Chamber of Commerce, in Charleston, South Carolina at 12:40 PM ET, while Minneapolis Federal Reserve Bank President Gary Stern would speak at a luncheon of the Economic Club of Minnesota in Minneapolis on Better Late Than Never: Addressing Too-Big-To-Fail at 1 PM ET.
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