Correlation Breakdown as Proxies for Risk Boost Aussie, Kiwi
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The Australian and New Zealand dollars, this year’s best-performing currencies among developed economies, are reducing their links with stocks and commodities as investors search for faster growth and higher interest rates.
The correlation between the currencies and global stocks has fallen from record highs, according to data compiled by Bloomberg, and the relationship to raw material costs is also fading. The so-called Aussie is up 3 percent this year and the kiwi has risen 4.2 percent versus nine peers tracked by the Bloomberg Correlation-Weighted Indexes.