Australia’s dollar climbed against all major counterparts even after the Reserve Bank of Australia cut the benchmark interest rate.
The central bank lowered the overnight cash-rate target to 3 percent from 3.25 percent. The reduction had been forecast by economists surveyed by Bloomberg News. Demand for the so-called Aussie was damped after Australian data showed building approvals dropped the most in three months and the nation posted a wider-than-estimated current-account deficit.
“There is no real guidance in terms of future rate cuts and some people see it as the potential end of a rate cut,” said Jonathan Cavenagh, a currency strategist in Singapore at Westpac Banking Corp. (WBC) “In the near term, we see the Aussie dollar hitting $1.05.”
The Australian dollar rose 0.3 percent to $1.0449 as of 2:57 p.m. in Sydney after losing 0.5 percent over the previous three sessions. New Zealand’s currency added 0.3 percent to 82.31 U.S. cents.
The nation’s bonds fell, with the benchmark 10-year yield gaining five basis points to 3.19 percent.
The number of permits granted to build or renovate houses and apartments in Australia declined 7.6 percent in October from the prior month, the statistics bureau said today. The country posted a A$14.9 billion ($15.5 billion) deficit for the third quarter in its current account, the broadest measure of trade, figures from the bureau showed, compared with the $14.6 billion shortfall estimated by economists.
To contact the editor responsible for this story: Rocky Swift at firstname.lastname@example.org