Australian Dollar Advances Most in a Month Since December on Economy, RBA

The Australian dollar rose to a record and gained the most in a month since December after Treasurer Wayne Swan said the currency’s strength reflects an improving economy and higher commodity prices.

The Aussie advanced for a sixth week versus the greenback as slower U.S. growth stoked speculation the Reserve Bank of Australia will raise interest rates before the Federal Reserve. New Zealand’s dollar had its biggest monthly jump since 2009 as exports rose to a record.

“Helping the Aussie is the strong economic performance of Australia, a continuation of the commodities boom,” said Imre Speizer, a market strategist in Auckland, New Zealand, at Westpac Banking Corp. “The kiwi has maintained an uptrend that started in the middle of March.”

The Australian dollar rose 0.4 percent to $1.0971 at 5:19 p.m. in New York, from $1.0929 yesterday, extending its monthly gain to 6.2 percent and its weekly rally to 2.2 percent. It touched $1.0978, highest level since the Aussie began trading freely in 1983.

New Zealand’s currency appreciated 0.9 percent to 80.99 U.S. cents. The kiwi appreciated 6.4 percent in April, the biggest gain since a 13 percent increase in May 2009.

The Aussie’s gain reflects the strength of the Australian economy, public finances, the job market and commodity prices, Swan said in a radio interview with Australian Broadcasting Corp. in Brisbane.

Raw Materials

The Thomson Reuters/Jefferies CRB Index of 19 raw materials surged 35 percent over the past year. Gold climbed today to a record $1,569.32 an ounce.

Traders added to bets the RBA will increase interest rates, according to a Credit Suisse Group AG index based on swaps. The central bank will boost borrowing costs by 25 basis points, or 0.25 percentage point, over the next 12 months, compared with a forecast of 19 basis points last week.

Consumer prices in Australia increased 1.6 percent last quarter from the previous three months, the biggest jump since 2006, the Bureau of Statistics said April 27.

To contact the reporter on this story: Masaki Kondo in Singapore at mkondo3@bloomberg.net

To contact the editor responsible for this story: Dave Liedtka at dliedtka@bloomberg.net

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.