Australian Dollar Falls Amid Slowdown Concerns, Chinese Stocks

The Australian dollar fell to the weakest level in more than a month against its U.S. peer after the nation’s home-building permits fell by the most in a decade.

The Aussie declined to a nearly two-month low against the euro as China’s Shanghai Composite Index (SHCOMP) slipped to its lowest level since February 2009. China is the nation’s largest trading partner. New Zealand’s dollar weakened versus 13 of its 16 most- traded counterparts as global stocks and commodities dropped.

“We continue to hold some Australian dollars, but it’s certainly not as attractively priced since there are more headwinds now,” Axel Merk, founder and president of Merk Investments LLC in Palo Alto, California, said on a radio interview on “Bloomberg Surveillance” with Tom Keene and Ken Prewitt. “We tend to be more positive on the China story that is very closely linked to Australia. But, by all means, there is some slowing down happening in Australia.”

The Aussie fell 0.6 percent to $1.0289 yesterday in New York, touching $1.0277, the lowest since July 25. It fetched A$1.21548 per euro, after reaching A$1.21621, the weakest since July 5. It declined 0.7 percent to 80.90 yen.

New Zealand’s dollar, known as the kiwi, fell 0.3 percent to 79.81 U.S. cents and slumped 0.4 percent to 62.75 yen.

The MSCI World Index (MXWO) of stocks fell 0.9 percent and the Standard & Poor’s GSCI index of 24 raw materials tumbled 0.3 percent.

The number of permits granted to build or renovate houses and apartments slumped 17.3 percent from June, when they fell a revised 1 percent, the Bureau of Statistics said in Sydney yesterday. That was the steepest slide since November 2002.

To contact the reporter on this story: Allison Bennett in New York at abennett23@bloomberg.net

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

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