Aussie Falls Versus Peers Before China PMI Forecast to Contract

Australia’s dollar fell against most of its major peers before a private report tomorrow that is forecast to signal a manufacturing contraction in China, the nation’s largest trading partner.

The Aussie slid for the first time in four days versus the yen as Asian stocks weakened, damping demand for higher-yielding assets. Annual wage costs in Australia climbed in the fourth quarter by the least on record, the statistics bureau said.

“China’s PMIs have been edging lower in recent months, and this may continue,” Greg Gibbs, a Singapore-based strategist at Royal Bank of Scotland Group Plc, wrote in an emailed report, referring to the Purchasing Managers’ Index. The Aussie and Kiwi “appear vulnerable,” he wrote.

Australia’s dollar was little changed at 90.23 U.S. cents as of 5:36 p.m. in Sydney, after yesterday touching 90.81, the highest level since Jan. 13. It declined 0.2 percent to 92.19 yen and slipped 0.2 percent to NZ$1.0847.

A flash estimate of China manufacturing PMI was unchanged at 49.5 in February, HSBC Holdings Plc and Markit Economics will probably say tomorrow, according to the median estimate in a Bloomberg News survey. The reading below 50 would indicate a contraction.

Australia’s fourth-quarter wage index rose 2.6 percent from a year ago, the slowest pace of gains in data going back to 1998, the statistics bureau said today.

The nation’s bonds rose today with the three-year yield declining four basis points, or 0.04 percentage point, to 2.97 percent. The 10-year rate fell four basis points to 4.14 percent.

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