By ForexMansion.com
The AUD/USD continues to move higher and aussie set a new historic high versus the dollar as the general sentiment remains positive.
The Australian dollar has touched the strongest level since 1983, on speculation that global growth will fuel demand for commodities, which are a majority of the nation’s exports.
The US fundamentals confirmed that the world’s largest economy is recovering, supporting the market sentiment to improve, which pushed the investors to buy high-yielding currencies.
Asian stocks moved higher Tuesday after some Japanese companied said their will return to production and open factories after the devastating March 11 earthquake and tsunami, supporting the sentiment on a faster than expected resumption of production.
Projections indicate that the pair will decline as the improvements in the US economy, raising demand for the dollar, and prevailing high uncertainty in the market might trigger the correction anytime soon.
Ahead of Thursday the focus will be on the ADP from the US at 12:15 GMT as investors look for signals for Friday’s nonfarm payrolls.
On Thursday the Australian economy will release the building permits during the month of February at 00:30 GMT, and expected to rise by 4.0% compared with the previous drop by 15.9%, as for the annual reading it is expected to decline by 12.8% after the previous drop by 24.8%.
Also at 00:30 GMT retails sales for the month of February will be released and expected to remain unchanged from the previous month with 0.4% rise.
As for the US economy, it will release a number of data on Thursday; the weekly jobless claims will be released at 12:30 GMT and is expected to show 380 thousand, compared with 382 thousand. Chicago PMI index for the month of March will be released at 13:45 GMT and is expected at 70.0 compared with 71.2.
On the other hand, the expectations indicate that the U.S. and European Central Bank are going to starting withdrawing their stimulus from financial markets. The European Central Bank is expected to increase the benchmark interest rate during the next meeting, which will influence the overall market sentiment and might support aussie on RBA moves unless the dollar gains grounds and start to reflect its strong fundamentals once the feds insure the shift to hawkish stance.
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Originally posted here
