Australian, N.Z. Dollars Advance as Economic Data Beat Estimates
February 23, 2012, 12:58 PM ESTBy Allison Bennett and Kristine Aquino
Feb. 23 (Bloomberg) -- The Australian and New Zealand dollars advanced against their major peers as stocks rallied after economic data in Europe and the U.S. beat estimates.
The so-called Aussie and kiwi rose for the first time in three days versus the greenback as German business confidence increased to the highest level in seven months amid progress taming the region’s debt crisis. Initial jobless claims in the U.S. held at a four-year low. Gains in the Australian dollar were limited as Prime Minister Julia Gillard called a ballot for the leadership of the ruling Labor Party following Foreign Minister Kevin Rudd’s resignation.
“It looks like risk appetite is reasonably well underpinned,” said Ray Attrill, head of currency strategy for BNP Paribas SA in New York. “It’s a little bit of ‘no news is good news’ as far as the euro zone is concerned.”
Australia’s dollar gained 0.5 percent to $1.0687 at at 12:17 p.m. New York time. It earlier slid to $1.0598, the weakest since Feb. 1. The currency rallied 0.4 percent to 85.78 yen.
The New Zealand dollar rose 0.6 percent to 83.40 U.S. cents. The kiwi rose 0.4 percent to 66.87 yen.
The Standard & Poor’s 500 Index rose 0.3 percent and the MSCI World Index of stocks climbed 0.3 percent. The S&P GSCI Index of 24 raw materials gained 0.2 percent.
Australia Elections
The kiwi has appreciated 0.3 percent today, the best performer among the 10 developed-nation currencies tracked by Bloomberg Correlation-Weighted Indexes. The Aussie has gained 0.2 percent.
Gillard called for a leadership ballot on Feb. 27, seeking to end weeks of tension with Rudd, whom she ousted from the top post in 2010.
In a news conference from Washington today shortly before Gillard spoke, Rudd said he was encouraged by support he has received from party colleagues since he resigned overnight.
“This is a diversion from the government actually pushing through whatever they need to push through,” said Derek Mumford, a director in Sydney at Rochford Capital, a currency- risk management company. “All this, in the very short term, is not a good thing for the Aussie dollar.”
The currency may see a “small correction” and may decline toward $1.05 in coming weeks, Mumford said.
Applications for U.S. jobless benefits were unchanged in the week ended Feb. 18 at 351,000, the fewest since March 2008, Labor Department figures showed today. The median projection in a Bloomberg News survey called for 355,000 claims. The Munich- based Ifo institute said its business climate index, based on a survey of 7,000 executives, climbed to 109.6 from 108.3 in January.
--Editor: Kenneth Pringle
To contact the reporter on this story: Kristine Aquino in Singapore at kaquino1@bloomberg.net Allison Bennett in New York at abennett23@bloomberg.net
To contact the editor responsible for this story: Dave Liedtka at dliedtka@bloomberg.net
