Aussie, Kiwi Gain Versus Yen on Improving U.S. Growth Prospects

Monday, 16 January 2012 09:12 PM

Jan. 17 (Bloomberg) -- The Australian and New Zealand dollars advanced against the yen before a report forecast to show manufacturing in the New York region climbed this month, boosting demand for higher-yielding assets.

The so-called Aussie strengthened as Asian stocks rose. An advance by New Zealand’s dollar was limited as figures showed the nation’s business confidence and card spending both fell at the end of 2011. China will report figures for gross domestic product today.

“There are a number of countries outside of Europe which are showing stronger-than-expected growth,” said Adam Carr, a senior economist in Sydney at ICAP Australia Ltd., a unit of the world’s biggest interdealer broker. “I think we’ll continue to see Aussie and kiwi well-bid.”

Australia’s dollar gained 0.3 percent to 79.42 yen as of 12:41 p.m. in Sydney from yesterday in New York. It traded at $1.0333 from $1.0314. The Aussie rose 0.1 percent to 81.50 euro cents, after matching a record high of 81.55.

New Zealand’s currency advanced 0.3 percent to 61.09 yen and was at 79.49 U.S. cents from 79.36.

The MSCI Asia Pacific Index of shares rose 0.6 percent.

The Federal Reserve Bank of New York’s general economic index, a gauge of manufacturing in the region, gained to 11 this month from 9.5 in December, according to the median estimate in a Bloomberg News poll. The report will be released today.

N.Z. Economy

Business confidence in New Zealand dropped in the fourth quarter, according to a survey conducted by the New Zealand Institute of Economic Research Inc. The value of transactions on electronic cards also declined last month, the statistics bureau said separately today in Wellington.

Chinese gross domestic product rose 8.7 percent in the three months through December from a year earlier, according to the median forecast of economists surveyed by Bloomberg. That would be the slowest pace since the second quarter of 2009. The data, along with indicators for investment, retail sales and industrial production, are due to be released today in Beijing.

“You’ve got to have one eye open on China always,” said Kurt Magnus, executive director of currency sales in Sydney at Nomura Holdings Inc., Japan’s biggest brokerage. “Any surprise on the downside will be inhibitive for Aussie and kiwi in the short term.”

China is Australia’s biggest trading partner and New Zealand’s second-largest export destination.

Australia’s benchmark 10-year yield rose nine basis points, or 0.09 percentage point, to 3.76 percent. Yields on the nation’s three-year debt gained seven basis points to 3.22 percent. New Zealand’s two-year swap rate, a fixed payment made to receive floating rates, was unchanged at 2.82 percent.

--Editors: Naoto Hosoda, Jonathan Annells

To contact the reporter on this story: Kristine Aquino in Singapore at kaquino1@bloomberg.net

To contact the editor responsible for this story: Garfield Reynolds at greynolds1@bloomberg.net

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Monday, 16 January 2012 09:12 PM
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