Oil rebounds, lifts aussie and kiwi to 10-month highs

Commodity-linked currencies such as the Australian, New Zealand and Canadian dollars strengthened versus the US dollar to reverse some losses made on Monday. These riskier currencies fell yesterday when markets were unsettled following news that a meeting of oil producers in Doha, Qatar on Sunday failed to reach an agreement to cap oil production.

The Australian dollar rose to a near 10-month high against its US counterpart to hit $0.7759 after falling to a nearly one-week low of $0.7594. A rebound in oil prices helped risk appetite for commodity currencies after a strike by Kuwaiti oil and gas workers boosted oil prices.

NZDUSD extended higher to $0.7004, the highest level since June 2015.

USDCAD was down to $1.2750 in Asian trading today after reaching as high as $1.2988 on Monday.

The US dollar index was down after New York Fed President William Dudley reinforced the Fed’s dovish tone on Monday in a speech, stating that U.S. economic conditions are “mostly favorable” yet the Fed remains cautious in raising interest rates because threats loom.

In contrast, analysts said the European Central Bank may have run out of ammunition to weaken the euro. The ECB will meet in Frankfurt on Thursday. Analysts said the view that the ECB would have trouble weakening the euro further, combined with expectations for a dovish Fed, helped the euro gain against the dollar.

The euro was last up 0.27 percent against the dollar at $1.1312 after hitting a session high of $1.1332.

The post Oil rebounds, lifts aussie and kiwi to 10-month highs appeared first on FXTM Blog.

Source:: Oil rebounds, lifts aussie and kiwi to 10-month highs

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