Aussie Touches 4-Month High; Pares Gain as RBA Changes Language

Australia’s dollar broke above 93 U.S. cents for the first time in four months after the central bank left interest rates unchanged and said a record-low benchmark would help strengthen growth.

The Aussie pared gains as Governor Glenn Stevens changed his references to the currency, indicating recent gains may detract from an economic rebalancing as mining investment declines. He reiterated that it “remains high by historical standards.” Australia’s dollar advanced earlier after a Chinese official manufacturing index strengthened for the first time in five months.

“A little bit more verbal intervention brought the Aussie back down,” said David Forrester, a senior vice president for Group of 10 foreign-exchange strategy at Macquarie Bank Ltd. in Singapore. “It’s only marginally more aggressive intervention than we saw last month. They are directly avoiding trying to indicate any sort of level.”

Australia’s dollar rose as high as 93.04 U.S. cents, the strongest level since Nov. 21, before at 92.76 as of 5:54 p.m. in Sydney, little changed from yesterday in New York. The Aussie rose 0.1 percent to 95.76 yen after touching 96.06, the most since June 5.

“The decline in the exchange rate from its highs a year ago will assist in achieving balanced growth in the economy,” Stevens said in today’s policy statement, echoing past references. He added that this impact would be “less so than previously as a result of the rise over the past few months,” for the local dollar.

China’s Purchasing Managers’ Index rose to 50.3 in March, the National Bureau of Statistics and China Federation of Logistics and Purchasing said today. That compared with February’s 50.2 reading and the 50.1 median estimate from analysts in a Bloomberg News survey. Numbers above 50 signal expansion.

Australia’s 10-year bond yield rose five basis points, or 0.05 percentage point, to 4.13 percent. The three-year rate gained three basis points to 3.02 percent.

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