By Wayne Cole
SYDNEY, June 6 (Reuters) - The Australian and New Zealand dollars were looking to end the week with hefty gains on Friday as a hint of thawing in the U.S.-China trade impasse aided risk sentiment, while investors everywhere braced for the all-important U.S. jobs report.
The Aussie was up 1.1% for the week at $0.6508 AUD=D3, having touched a six-month top of $0.6538 overnight. A break of $0.6550 would open the way toward the next bull target at $0.6687, while support lies at $0.6450 and $0.6390.
The kiwi dollar stood at $0.6038 NZD=D3, having climbed 1.1% for the week to reach an eight-month peak of $0.6080. The next upside targets are $0.6119 and $0.6379.
A run of soft economic data this week has markets wary of a downside surprise in payrolls which would possibly bring forward a rate cut from the Federal Reserve, so undermining the greenback.
That has also helped offset disappointing domestic data that has markets pricing an 80% probability the Reserve Bank of Australia will cut its 3.85% cash rate by 25 basis points when it next meets on July 8. 0#AUDIRPR
There is a problem with timing in that the meeting is the day before U.S. President Donald Trump's July 9 supposed deadline on his April 2 tariffs, which might argue for the central bank to wait and see what happens.
"If several significant deals are not landed by the deadline the U.S. may lose patience and reinstate unilateral tariffs, either generally or on specific countries, sparking another round of volatility in global markets," warned Luke Yeaman, chief economist at CBA.
The RBA may also prefer to wait for the full second-quarter consumer price report which is not due until late July, and review rates at its August policy meeting.
The Reserve Bank of New Zealand has signalled it will be more cautious in future easing given it has already cut rates by 225 basis points to 3.25%.
As a result, markets imply only a one-in-three chance the RBNZ will ease again at its July meeting, with a 76% probability for August. Investors also suspect it may be one and done, with 3.0% around neutral for the economy.
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