AUD/USD off earlier highs during early European trade on Tuesday

Having touched daily highs due to increased demand for high-yielding assets earlier on Tuesday, Australian dollar gave back its advance against the US rival during the early phase of European session.

AUD/USD touched a daily high at 0.9044 at 1:21 GMT, after which consolidation followed at 0.9023, losing 0.13% for the day. Support was likely to be received at February 24th low, 0.8938, while resistance was to be encountered at February 24th high and also the highest level since February 18th, 0.9049.

Yesterday the Aussie gained ground against peers and was set to register the largest monthly gain after Norway’s krone and the kiwi in February, as commodity prices rose. The S&P GSCI Index (SPGSCI) of commodity prices has climbed 4.7% since January 31st. Norways krone has risen 4.09%, New Zealand’s dollar has appreciated 3.08%, while the Aussie has climbed 3.06% this month.

“Improving risk appetite is giving AUD some relief,” Mitul Kotecha, the global head of foreign-exchange strategy at Credit Agricole SA in Hong Kong, wrote in an e-mailed note to clients today, cited by Bloomberg News. “Downside risks to the currency remain limited, with its resilience set to continue.”

In addition, the MSCI Asia Pacific Index of stocks gained 0.6% on Tuesday and was set for a 2.4% advance in February.

Meanwhile, home values in 20 large cities in the United States probably curbed their increase, with the corresponding index rising at an annualized rate of 13.38% in December, according to the median estimate by experts. In November home prices gained 13.71%. S&P/Case-Shiller will publish the official figures at 14:00 GMT today.

At 15:00 GMT the Conference Board research group is expected to announce the results from its survey on consumer confidence regarding the United States. The index of consumer confidence probably slowed down to a reading of 80.0 in February from 80.7 in the preceding month. Higher than expected readings will certainly provide support to greenbacks demand.

Consumer confidence, as an indicator, provides clues regarding the tendency in consumer spending in the country, while the latter accounts for almost two thirds of nations Gross Domestic Product.

Elsewhere, the Australian currency was lower against the euro, with EUR/AUD cross up 0.41% on a daily basis to trade at 1.5267 at 8:05 GMT. AUD/NZD was losing 0.23% to trade at 1.0822 at 8:09 GMT. The pair earlier touched a daily high at 1.0851.