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The Australian and New Zealand dollars got a much needed lift on Monday, bolstered by China's decision to halve its stamp duty on stock trades and remarks from Federal Reserve chair Jerome Powell that came across as not too hawkish.
The Aussie rose 0.4% to $0.6428, after having moved sideways for much of last week around a nine-month trough of $0.6365.
It still faces major resistance around $0.6450 - a level it failed to break above last week due to a buoyant U.S. dollar and ever-present concerns that China's economic recovery is sputtering.
The kiwi was up 0.3% to $0.5918, having eased 0.4% last week to a fresh nine-month low of $0.5886. Major resistance lies around $0.5980.
Asian share markets rallied after China announced the stamp duty cut "to invigorate the capital market and boost investor confidence." The move also helped lift offshore yuan , which the Aussie tracks closely due to Australia's exposure to the Chinese market, to 7.2688 per dollar, not far from a two-week peak.
Global central bankers at the Jackson Hole Symposium on Friday did not deviate much from previous rhetoric, with Fed Chair Jerome Powell promising to move with care at upcoming rate decision meetings.
Domestically, Australian retail sales rebounded in July after a sharp fall, but the annual rate slowed further, a result that should not upset the outlook for interest rates.
"Retail data remain consistent with a consumer 'weakening, but not collapsing," said George Tharenou, an economist at UBS.
Much will, however, depend on the monthly inflation report on Wednesday. Economists expect consumer inflation to ease further to 5.2% in July from 5.4% the previous month.
Markets see only a minuscule chance of about 3% about that the RBA could surprise with a hike in September, but see a risk that it could raise interest rates one more time by the end of this year.
(Reporting by Stella Qiu; Editing by Edwina Gibbs)