Bloomberg News

Aussie Rises to Two-Week High Before Lending Report; Kiwi Gains

June 29, 2011

June 30 (Bloomberg) -- The Australian dollar rose to a two- week high versus the greenback before a central bank report that economists said will show bank lending expanded last month.

The so-called Aussie advanced for a third day as traders trimmed bets that the Reserve Bank of Australia will cut interest rates in the next 12 months. New Zealand’s currency climbed toward a record versus the greenback on optimism European officials will support further aid for Greece, boosting demand for riskier assets.

“The market is expecting an improvement in the lending numbers and that could give the Aussie a little more upside momentum,” said Jim Vrondas, a manager at the online foreign- exchange dealer OzForex Ltd. in Sydney. “Domestically we’re looking pretty good.”

Australia’s dollar appreciated to $1.0706 as of 10:08 a.m. in Sydney from $1.0683 in New York yesterday after rising to $1.0711, the highest since June 15. The currency traded at 86.38 yen from 86.29 yen and reached 86.41, the most since June 6.

New Zealand’s dollar rose 0.4 percent to 82.82 U.S. cents, after reaching 82.92 cents, the most since June 9, when it touched a record. The kiwi advanced 0.2 percent to 66.83 yen.

Both currencies were supported after Greek Prime Minister George Papandreou won support yesterday for a bill laying out a strategy for budget cuts. Luxembourg’s Jean-Claude Juncker, who leads a group of euro-area finance ministers, said the Greek vote paves the way for payment of the next aid installment from euro-area governments and the International Monetary Fund.

Loans provided by Australian banks and finance companies increased 0.4 percent in May from the previous month, the RBA will say today, according to a Bloomberg News survey of economists.

New Zealand’s currency rose against 15 of its 16 major counterparts as a government report showed home-building approvals rose in May for the second time in three months. Permits increased 2.2 percent after falling a revised 1.2 percent in April, Statistics New Zealand said today.

--Editors: Rocky Swift, Naoto Hosoda

To contact the reporter on this story: Candice Zachariahs in Sydney at czachariahs2@bloomberg.net

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


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