Aussie Falls as German Confidence Data Signals Slowdown; Kiwi Halts Drop
The Australian dollar slid for a second day versus its U.S. counterpart as global equities fell amid speculation Germany’s public finances are deteriorating.
New Zealand’s dollar rose after a report yesterday showed retail sales advanced for the first time in three quarters. The Aussie also weakened versus a majority of its most-traded peers amid reduced prospects Federal Reserve Chairman Ben S. Bernanke will signal additional measures to stimulate the economy tomorrow.
“There are still a lot of global concerns and that still weighs heavily on sentiment,” said Matthew Brady, executive director for foreign exchange at JPMorgan Chase & Co. in Sydney. “I would like to sell any rallies for the Australian dollar at this point.”
Australia’s dollar slid 0.3 percent to $1.0444 at 12:16 p.m. in New York from $1.0474 yesterday, when it dropped 0.5 percent. It fell 0.3 percent to 80.83 yen from 80.63 yen.
New Zealand’s currency was little changed at 82.84 U.S. cents. The so-called kiwi surged 0.6 percent to 63.93 yen from 63.77 yen.
Germany-based market research company GfK SE today forecast that its consumer sentiment index will decline to 5.2 next month, the least since November 2010, from a revised 5.3 in August. Economists predicted a drop to 5.1 from the initial August estimate of 5.4, according to the median of 26 forecasts in a Bloomberg News survey.
Business confidence in Europe’s biggest economy has declined to the lowest in more than a year and investor sentiment this month sank the most in five years, data released this week showed.
Jackson Hole
The Fed chairman is scheduled to speak tomorrow at a conference of central bankers in Jackson Hole, Wyoming. At the same conference last year, Bernanke said the Fed would “do all that it can” to spur growth, raising speculation he will make similar comments this year. The Fed went on to announce in November a $600 billion debt-purchase plan, the second round of so-called quantitative easing that ended in June.
Demand for the kiwi was supported as better than forecast retail sales data lifted prospects for interest-rate increases by the Reserve Bank of New Zealand.
Statistics New Zealand said in Wellington today that retail sales adjusted for inflation rose 0.9 percent in the second quarter compared with a revised 1.1 percent gain in the three months ended March 31. That exceeded the 0.6 percent median estimate of 10 economists surveyed by Bloomberg.
“New Zealand consumer spending is far stronger than that observed in the other dollar-bloc countries,” Annette Beacher, head of Asia-Pacific research at TD Securities in Singapore, wrote in an e-mailed note today.
To contact the reporter on this story: Kristine Aquino in Singapore at kaquino1@bloomberg.net
To contact the editor responsible for this story: Rocky Swift at rswift5@bloomberg.net
Rate this Page