Antipodean Currencies Rise As Crude Oil Prices Traded Higher

(RTTNews) - The Antipodean currencies such as the Australia and the New Zealand dollars strengthened against their major currencies in the Asian session on Tuesday, as the crude oil prices climbed higher after data showed a sharp drop in U.S. crude inventories in the week ended December 20th. The ongoing conflict between Russia and Ukraine, and expectations of increased demand from China following the recent stimulus measures contributed as well to the rise in oil prices.

West Texas Intermediate Crude oil futures for February settled at $70.60 a barrel, gaining about 1.4%. Brent crude futures advanced 1.2% to $74.17 a barrel.

Data from the Energy Information Administration (EIA) said crude inventories in the U.S. fell by 4.2 million barrels last week, much higher than an expected drop of 1.9 million barrels.

Optimism about demand from China has increased following the World Bank raising its forecast for Chinese economic growth in 2024 and 2025.

Chinese authorities have agreed to issue special treasury bonds worth 3 trillion yuan ($411 billion) next year, as Beijing acts to revive the sluggish economy, according to a Reuters report earlier this week.

Traders anticipate the outlook for fewer Fed rate cuts in 2025.

In the Asian trading today, the Australian dollar rose to nearly a 2-week high of 98.52 against the yen and a 6-day high of 0.8989 against the Canadian dollar, from Friday's closing quotes of 98.09 and 0.8954, respectively. If the aussie extends its uptrend, it is likely to find resistance around 99.00 against the yen and 0.91 against the loonie.

Against the U.S. dollar and the euro, the aussie advanced to 4-day highs of 0.6243 and 1.6699 from last week's closing quotes of 0.6215 and 1.6761, respectively. On the upside, 0.64 against the greenback and 1.64 against the euro are seen as the next resistance levels for the aussie.

The aussie edged up to 1.1046 against the NZ dollar, from Friday's closing value of 1.1033. The next possible upside target for the aussie is seen around the 1.12 region.

The NZ dollar rose to nearly a 2-week high of 89.31 against the yen, from Friday's closing value of 88.88. If the kiwi extends its uptrend, it is likely to find resistance around the 91.00 region.

Against the U.S. dollar and the euro, the kiwi advanced to 4-day highs of 0.5657 and 1.8421 from last week's closing quotes of 0.5623 and 1.8511, respectively. The kiwi may test resistance around 0.58 against the greenback and 1.81 against the euro.

Looking ahead, Canada CFIB business barometer for December, U.S. Chicago PMI for December, pending home sales for November and U.S. Dallas Fed manufacturing index for December are slated for release.