* Aussie supported by upbeat China trade data
* RBNZ confirms has intervened to lower NZ dollar
* No details given on when intervention took place
By Masayuki Kitano
SINGAPORE, May 8 The Australian dollar pulled up
from a two-month low and the yen eased briefly on Wednesday,
after better-than-expected Chinese trade numbers eased some
concern about slowing growth in the world's second-largest
A big underperformer was the New Zealand dollar, which took
a hit after the head of the country's central bank said it had
intervened to try and restrain the strength of the currency. No
details were given on when such action took place.
Data showing that China's exports and imports grew more than
expected in April from a year earlier helped support the
Australian dollar and weighed on the yen, although doubts
remained about the strength of real demand.
The Aussie dollar is sensitive to economic data out of
China, Australia's biggest export destination.
The Australian dollar last fetched $1.0187, steady
on the day.
Still, that was up from a two-month low of $1.0155 set this
week after the Reserve Bank of Australia reduced the cash rate
by a quarter point to a record low 2.75 percent on Tuesday, and
left the door open to more easing.
Against the yen, the Aussie dollar held steady at 100.80 yen
, up from an intraday low of about 100.36 yen.
"The Australian dollar bounced a bit, as the bias had been
completely toward the downside and there had been some
accumulation of (short) positions," said Hiroshi Maeba, head of
FX trading Japan for UBS in Tokyo, referring to the Aussie
dollar's reaction to the Chinese trade data.
That helped lend support to cross/yen pairs and the U.S.
dollar versus the yen as well, Maeba said.
There has also been some dollar buying by Japanese importers
and traders taking fresh long positions in the greenback, but
the dollar could also start to see some options-related offers
on the top side, Maeba added.
The U.S. dollar was steady at 98.97 yen, having
rebounded from an intraday low near 98.64 yen.
The greenback, which hit a four-year high of 99.95 yen in
April after the Bank of Japan unveiled its drastic monetary
stimulus, has met stiff resistance near the psychologically key
100 yen level.
The euro edged up 0.1 percent to $1.3093, with the
near-term focus on German industrial production data coming up
later in the day.
NEW ZEALAND DOLLAR
The New Zealand dollar fell 0.8 percent to $0.8389.
The kiwi dollar fell after the Reserve Bank of New Zealand
said it had been selling the currency to limit its strength.
"There has been intervention," RBNZ Governor Graeme Wheeler
told a parliamentary committee. No details were given on the
timing of the currency market operations.
The RBNZ's latest balance sheet, which covers transactions
through March, shows scant selling of New Zealand dollars from
the bank's reserves during the first three months of the year,
after it sold a net NZ$199 million in December.
The figures do not cover transactions in April, when the New
Zealand dollar rose to a 20-month high of $0.8676.
Hamish Pepper, currency strategist for Barclays in
Singapore, said any impact from RBNZ intervention or talk of
such action is likely to be short-lived, especially when
considering the outlook for monetary policy.
"They're approaching the beginning of a tightening cycle.
Admittedly, we don't think it will actually start this year, we
think it's more a story for 2014," Pepper said.
"To the extent that you're trying to lean against your
currency at the same time you're approaching a tightening cycle,
there's an inconsistency there," he said.
Pepper said the RBNZ was unlikely to conduct large-scale
intervention. Even when they intervened on a large scale back in
2007, the impact had proved short-lived, he added.
A more crucial factor for the kiwi dollar is a likely
improvement later this year in the U.S. economy, which may
support U.S. yields and the U.S. dollar, Pepper said, adding
that the kiwi dollar could fall to about $0.82 in the near-term.