Oct. 19 (Bloomberg) -- The Australian and New Zealand dollars gained against their U.S. counterpart as global stocks extended a rally, boosting demand for riskier assets.
The Aussie rose against the yen after reports showed gains in leading economic indicators for Australia and China. The South Pacific currencies reversed earlier declines amid optimism European leaders will reach an agreement at a summit this weekend to bolster the region’s bailout fund.
“The risk environment is clearly improving,” said Thomas Harr, head of Asian currency strategy at Standard Chartered in Singapore. “The global economy is in OK shape and China is not slowing too much. The Australian and New Zealand dollars should be reasonably supported.”
Australia’s dollar climbed 0.3 percent to $1.0291 as at 11:47 a.m. in New York, after earlier falling as much as 0.3 percent. The currency advanced 0.2 percent to 79 yen.
New Zealand’s dollar gained 0.2 percent to 79.71 U.S. cents, erasing an earlier decline of 0.3 percent. The kiwi rose 0.1 percent to 61.20 yen.
The MSCI World Index of shares advanced 0.5 percent and the Standard & Poor’s 500 Index rose 0.1 percent.
A leading index of future economic growth in Australia advanced 0.8 percent in August from a month earlier to 287, Westpac Banking Corp. and the Melbourne Institute said in a statement in Sydney today. Westpac’s leading index tracks eight gauges of activity, including company profits and productivity.
A leading economic index for China rose 0.5 percent to 159.5 in August, the Conference Board, a New York-based research organization, said on its website today.
German Chancellor Angela Merkel and French President Nicolas Sarkozy pledged last week to present a plan to fix Europe’s debt crisis when leaders from the Group of 20 nations convene in Cannes, France on Nov. 3. The group’s finance ministers and central bankers meeting last weekend set an Oct. 23 summit of European leaders as a deadline to agree on a comprehensive solution.
--With assistance from Allison Bennett in New York. Editors: Paul Cox, Dave Liedtka
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