By Monami Yui
Australia’s dollar fell, extending a weekly decline against the greenback, as signs of a recovery in the U.S. labor market reduced the yield advantage of the South Pacific nation’s bonds over Treasuries.
The so-called Aussie slid to a five-week low versus the euro on prospects the European Central Bank will raise interest rates faster than the Reserve Bank of Australia over the next year. New Zealand’s dollar headed for its biggest weekly loss in two months against the greenback as the International Monetary Fund said it will likely cut the nation’s growth forecast.
“Jobs data could be dollar bullish,” said Greg Gibbs, a strategist at Royal Bank of Scotland Group Plc in Sydney. “It will keep the Aussie from breaking higher at this stage.”
Australia’s currency weakened to $1.0131 as of 2:55 p.m. in Sydney from $1.0146 in New York yesterday. It has fallen 0.5 percent this week. The Aussie declined 0.1 percent to 72.58 euro cents, after dropping to 72.44, the weakest since Jan. 28. It slid 0.2 percent to 83.45 yen.
New Zealand’s dollar fell to 73.68 U.S. cents, the lowest since Dec. 20, before trading at 73.79 cents from 74.10 cents yesterday. The kiwi was set for a 1.8 percent weekly drop against the U.S. dollar, the worst performer among 16 major peers. The currency depreciated 0.5 percent to 60.78 yen.
U.S. Jobs
U.S. nonfarm payrolls increased by 196,000 in February, according to the median forecast in a Bloomberg News survey of economists before the Labor Department reports the figures today. The total for January was 36,000. Initial jobless-benefits claims in the U.S. unexpectedly fell last week to the lowest since May 2008 data showed yesterday.
Ten-year government bond yields are about 2 percentage points higher in Australia than they are in the U.S., down from a difference of 2.12 percentage points a week ago.
The Australian dollar declined for a fifth day against the euro after European Central Bank President Jean-Claude Trichet said yesterday an “increase of interest rates in the next meeting is possible.” Europe’s central bank left its key rate at 1 percent yesterday.
“Given the ECB is very hawkish, crosses like Aussie and euro are starting to come under pressure,” said Jonathan Cavenagh, a currency strategist in Singapore at Westpac Banking Corp. “The RBA will be on hold for quite some time.”
Swaps traders are betting the Australia’s central bank will raise rates 36 basis points over the next 12 months, according to a Credit Suisse AG index.
Gillard Comment
The Australian currency also declined after Prime Minister Julia Gillard said yesterday the currency’s strength puts “burdens” on some parts of the economy. The Aussie reached as high as $1.0202 on March 1. That was 0.5 percent away from the $1.0256 peak on Dec. 31 that was the most since 1982.
New Zealand’s dollar weakened versus all of its 16 most- traded peers after the IMF said will “likely” cut its New Zealand growth forecast from the current 3 percent as a result of the two earthquakes there. IMF spokeswoman Caroline Atkinson spoke to a news conference in Washington yesterday.
The Reserve Bank of New Zealand will reduce its benchmark rate by 13 basis points over the next 12 months, compared with a prediction for an increase of 54 basis points a month ago, according to a Credit Suisse Group AG index. A separate Credit Suisse index shows traders are 100 percent certain of a rate cut at the next RBNZ meeting on March 10.
“The RBNZ will most likely cut their interest rate the coming week,” said Takuya Kawabata, a researcher in Tokyo at Gaitame.com Research Institute Ltd., a unit of Japan’s largest currency margin company. “That’s weighing on the kiwi.”
A 6.3-magnitude earthquake struck the South Island city of Christchurch on Feb. 22, the second major temblor in six months. The two quakes may have caused as much as NZ$20 billion ($15 billion) of damage, Prime Minister John Key has said. (sourced:bloomberg)
The so-called Aussie slid to a five-week low versus the euro on prospects the European Central Bank will raise interest rates faster than the Reserve Bank of Australia over the next year. New Zealand’s dollar headed for its biggest weekly loss in two months against the greenback as the International Monetary Fund said it will likely cut the nation’s growth forecast.
“Jobs data could be dollar bullish,” said Greg Gibbs, a strategist at Royal Bank of Scotland Group Plc in Sydney. “It will keep the Aussie from breaking higher at this stage.”
Australia’s currency weakened to $1.0131 as of 2:55 p.m. in Sydney from $1.0146 in New York yesterday. It has fallen 0.5 percent this week. The Aussie declined 0.1 percent to 72.58 euro cents, after dropping to 72.44, the weakest since Jan. 28. It slid 0.2 percent to 83.45 yen.
New Zealand’s dollar fell to 73.68 U.S. cents, the lowest since Dec. 20, before trading at 73.79 cents from 74.10 cents yesterday. The kiwi was set for a 1.8 percent weekly drop against the U.S. dollar, the worst performer among 16 major peers. The currency depreciated 0.5 percent to 60.78 yen.
U.S. Jobs
U.S. nonfarm payrolls increased by 196,000 in February, according to the median forecast in a Bloomberg News survey of economists before the Labor Department reports the figures today. The total for January was 36,000. Initial jobless-benefits claims in the U.S. unexpectedly fell last week to the lowest since May 2008 data showed yesterday.
Ten-year government bond yields are about 2 percentage points higher in Australia than they are in the U.S., down from a difference of 2.12 percentage points a week ago.
The Australian dollar declined for a fifth day against the euro after European Central Bank President Jean-Claude Trichet said yesterday an “increase of interest rates in the next meeting is possible.” Europe’s central bank left its key rate at 1 percent yesterday.
“Given the ECB is very hawkish, crosses like Aussie and euro are starting to come under pressure,” said Jonathan Cavenagh, a currency strategist in Singapore at Westpac Banking Corp. “The RBA will be on hold for quite some time.”
Swaps traders are betting the Australia’s central bank will raise rates 36 basis points over the next 12 months, according to a Credit Suisse AG index.
Gillard Comment
The Australian currency also declined after Prime Minister Julia Gillard said yesterday the currency’s strength puts “burdens” on some parts of the economy. The Aussie reached as high as $1.0202 on March 1. That was 0.5 percent away from the $1.0256 peak on Dec. 31 that was the most since 1982.
New Zealand’s dollar weakened versus all of its 16 most- traded peers after the IMF said will “likely” cut its New Zealand growth forecast from the current 3 percent as a result of the two earthquakes there. IMF spokeswoman Caroline Atkinson spoke to a news conference in Washington yesterday.
The Reserve Bank of New Zealand will reduce its benchmark rate by 13 basis points over the next 12 months, compared with a prediction for an increase of 54 basis points a month ago, according to a Credit Suisse Group AG index. A separate Credit Suisse index shows traders are 100 percent certain of a rate cut at the next RBNZ meeting on March 10.
“The RBNZ will most likely cut their interest rate the coming week,” said Takuya Kawabata, a researcher in Tokyo at Gaitame.com Research Institute Ltd., a unit of Japan’s largest currency margin company. “That’s weighing on the kiwi.”
A 6.3-magnitude earthquake struck the South Island city of Christchurch on Feb. 22, the second major temblor in six months. The two quakes may have caused as much as NZ$20 billion ($15 billion) of damage, Prime Minister John Key has said. (sourced:bloomberg)
Posts
No comments:
Post a Comment