Helping sentiment was a Caixin survey of Chinese manufacturing which showed a surprise pick-up in activity in December even as Beijing pursued a crackdown on industrial pollution. The news was taken as positive for continued Chinese demand for commodities, which has supported prices in recent months. Prices for iron ore, Australia's single biggest export earner, were holding above $70 a tonne having been down around $50 in mid-2017.
Australian government bond futures eased a touch in the wake of the China news, with the three-year bond contract off 2.5 ticks at 97.815. The 10-year contract lost 2 ticks to 97.3200. Likewise, copper climbed 31 percent in 2017 to a four-year top, while aluminium amassed gains of 34 percent. China is the world's largest consumer of industrial metals and accounts for nearly half of global copper demand.
Prices for coal and liquefied natural gas, two more major Australian exports, were also buoyed by Asian demand. "In a year of continued, perhaps improving, synchronised global growth the Aussie should benefit," said Greg McKenna, chief market strategist at CFD and FX provider AxiTrader.
"A weaker, or stronger, US dollar also feeds into commodity prices which in turn feed into the Aussie."