Australia Bond Yields Fall to 2013 Low Amid Global Risk Aversion

Australia’s bond yields slid to the lowest this year as bird influenza in China, tension surrounding North Korea and signs of a slowing U.S. economy boosted demand for the safety of government debt.

The South Pacific nation’s currency, known as the Aussie, fell to a three-week low after local data showed the construction industry shrank at a faster pace in March than the prior month. The currency declined to the weakest since February against New Zealand’s dollar.

“I see the Aussie going lower,” said Imre Speizer, a strategist in Auckland at Westpac Banking Corp., Australia’s second-biggest lender. “Global risk aversion” is pushing Australian government yields lower, he said.

The rate on Australia’s current 10-year note declined eight basis points to 3.23 percent as of 10:38 a.m. in Sydney after touching 3.18 percent, the lowest since Dec. 12.

The Australian dollar slid to $1.0348, the weakest since March 18, before trading at $1.0372, down 0.1 percent from the close on April 5. It lost as much as 0.6 percent to NZ$1.2242, a level unseen since Feb. 20. New Zealand’s currency, nicknamed the kiwi, fell 0.2 percent to 84.16 U.S. cents.

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

To contact the editor responsible for this story: Rocky Swift at rswift5@bloomberg.net

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