The Australian dollar has risen by more than 4% in the past week, shaking off the downward pressure of May and early this month.
The currency traded around 85.60 USC yesterday in Asia, up from the close a week earlier of 81.56.
It rose over 86 USc in European and US trading
The rebound has gone without much notice from the usual worryworts in the commentariat who portray the currency’s moves in terms of national strength/weakness, or perceive some sort of lurking disaster.
At the same time the euro has firmed from well under $US1.19 to over $US1.22 last night.
The firming comes as risk aversion has eased on global markets.
US 10 year treasury bonds traded around 3.22%, up sharply from the week’s lows of under 3.10%.
They rose further in US trading to around 3.28%, despite Moody’s downgrading Greece to junk, the last of the three major ratings groups to cut the struggling country’s rating.
Most global markets last week firmed, the falls in commodity prices eased and oil recovered a touch over the week, although it fell Friday.
Copper bounced higher on Friday after the Chinese economic figures for May showed no real change in the economy’s growth profile.
Copper, oil and other commodity prices rose strongly last night, while gold was down around $US8 to $US1222 an ounce.
But the news flow from the US was again very mixed: slightly higher consumer confidence against an unexpectedly large 1.2% fall in retail sales in May.
The news out of China was OK, inflation up, industrial production down, house prices showing signs of weakening, but no real disasters.
In fact the turnaround in sentiment in Asia yesterday was a bit startling: last week saw some a big sell off on Thursday, then a bounce on Friday, which continued yesterday.
European markets and the US were firmer, but the Dow closed down after a late bout of selling.
Japan’s Nikkei Stock Average was up 1.6%, South Korea’s Kospi Composite was up 0.9% and Hong Kong’s Hang Seng Index added 0.9%.
In fact the Hong Kong market regained the 20,000 point mark for the Hang Seng for the first time in weeks.
Markets in China and Australia were closed for a public holiday.
