Bloomberg News

Aussie Dollar Falls Before Jobs Report as China Inflation Slows

November 09, 2011

Nov. 9 (Bloomberg) -- The Australian dollar declined against the majority of its most-traded counterparts after China’s inflation slowed and industrial output grew at the slowest pace in a year.

The Aussie slid to a two-week low against the yen before a report tomorrow forecast to show the unemployment rate rose in October. The Australian and New Zealand currencies fell further as Italy’s debt turmoil sapped demand for riskier assets.

China’s “demand for Australia’s commodities and resources is likely to fall, so that is weighing on the Aussie dollar,” said Lee Wai Tuck, a currency strategist at Forecast Pte in Singapore.

Australia’s dollar depreciated 1.9 percent to 79.21 yen at 1:03 p.m. New York time. It earlier touched 78.94, the lowest level since Oct. 26. The currency slipped 1.9 percent to $1.0191. The New Zealand dollar lost 1.6 percent to 61.03 yen. It declined 1.6 percent to 78.54 U.S. cents.

Australia’s unemployment rate rose to 5.3 percent in October from 5.2 percent in the previous month, according to the median forecast of economists in a Bloomberg News survey before the figures are released tomorrow.

China’s consumer prices climbed 5.5 percent in October from a year earlier, compared with a 6.1 percent gain in the previous month, the National Bureau of Statistics said on its website today. Industrial output rose 13.2 percent in October, less than the 13.4 percent median estimate in a Bloomberg News survey and down from a 13.8 percent gain in the previous month.

The Standard & Poor’s 500 Index fell 2.3 percent today, the most on a closing basis since Nov. 1. The Reuters/Jefferies CRB Index of raw materials decreased 2.3 percent.

Italy’s bonds slumped, driving two-, five-, 10- and 30-year yields to euro-era records, after LCH Clearnet, a clearinghouse, increased the deposit it demands for trading the nation’s securities. Australia’s bonds fell, with yields on 10-year debt rising to 4.22 percent.

--With assistance from Allison Bennett in New York. Editors: Kenneth Pringle, Dennis Fitzgerald

To contact the reporter on this story: Mariko Ishikawa in Tokyo at mishikawa9@bloomberg.net

To contact the editor responsible for this story: Dave Liedtka at dliedtka@bloomberg.net


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