Bloomberg News

Aussie, N.Z. Dollars Decline as U.S. Growth Damps Stimulus Hopes

August 29, 2012

The Australian and New Zealand dollars fell versus their U.S. peer after American economic data showed signs of growth, damping speculation of further stimulus.

The two South Pacific nations’ currencies weakened after the Federal Reserve said yesterday the U.S. economy continued to expand “gradually.” The New Zealand dollar fell versus the yen as U.S. reports also showed gross domestic product grew more than previously estimated in the second quarter and pending home sales in July exceeded forecasts.

“The pick-up in activity is modest and there is no new leading factor that forces us to change our view that further stimulus is awaiting approval,” Andrew Wilkinson, chief economic strategist at Miller Tabak & Co. in New York, wrote yesterday in a note to clients.

The Aussie fell 0.2 percent to $1.0352 in New York yesterday, after earlier gaining as much as 0.2 percent. The currency was little changed at 81.47 yen.

New Zealand’s dollar, known as the kiwi, decreased 0.5 percent to 80.05 U.S. cents, after also rising as much as 0.2 percent earlier. The kiwi fell 0.3 percent to 63.01 yen.

The Standard & Poor’s GSCI Index of 24 raw materials decreased was little changed. The S&P 500 Index gained 0.1 percent.

To contact the reporter on this story: Joseph Ciolli in New York at jciolli@bloomberg.net

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


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