The Australian dollar has crept higher, extending its post-gross domestic product rally against a defensive US counterpart.
At 0635 AEST on Thursday, the Australian dollar was worth 76.66 US cents, up from 76.54 US cents on Wednesday.
Westpac analysts say the US dollar is in defensive mode.
‘The US dollar index is down 0.2 per cent on the day,’ they said in a morning note.
‘(The) AUD outperformed, extending its post-GDP data reaction to 0.7677 – a one-month high.’
The key event risk for the local currency on Thursday would be Australia’s April trade balance, the analysts say.
‘(It) is expected to be a $1.0 billion surplus (Westpac predicts $0.9bn) down from $1.5 billion in March as exports slip on lower prices for iron ore and coal in the month.’
The analysts say the Australian dollar is likely to head higher still.
‘Recent economic data, notably GDP, has been supportive, and momentum is positive, arguing for a higher AUD towards 0.7700 if risk sentiment remains upbeat.’
The Aussie dollar is also higher against the yen, but lower against the euro.
CURRENCY SNAPSHOT AT 0635 AEST THURSDAY
One Australian dollar buys:
* 76.66 US cents, from 76.54 on Wednesday
* 84.48 Japanese yen, from 84.20 yen
* 65.11 euro cents, from 65.28 euro cents
(*Currency closes taken at 1700 AEST previous local session)