Kiwi Falls on Global Growth Concern; Aussie Weaker on Confidence Figures
Aug. 10 (Bloomberg) -- Australian Treasurer Wayne Swan talks about the nation's economy, central bank monetary policy and currency. Swan also discusses Federal Reserve monetary policy and the outlook for the global economy. He speaks from Canberra with Susan Li on Bloomberg Television's "First Up." (Source: Bloomberg)
Aug. 10 (Bloomberg) -- Todd Elmer, head of Group-of-10 currency strategy for Asia ex-Japan at Citigroup Inc., talks about Federal Reserve monetary policy and the outlook for global currencies. Elmer speaks from Singapore with Susan Li on Bloomberg Television's "First Up." (Source: Bloomberg)
The New Zealand dollar fell against its U.S. counterpart on concern global growth prospects are too limited to sustain demand for higher-yielding currencies.
The kiwi, as New Zealand’s currency is nicknamed, slid versus all of its 16 major peers as the Federal Reserve’s pledge to hold down interest rates failed to calm anxiety that growth is slowing worldwide. The Australian dollar dropped versus the yen and the greenback after a report showed consumer confidence slumped to its lowest in more than two years.
“Global growth might be weaker than people were previously expecting,” said Roland Randall, an economist at Toronto- Dominion Bank’s TD Securities unit in Singapore. “Commodity demand should be actually lower, therefore the Aussie dollar and New Zealand dollar” declined.
New Zealand’s dollar dropped 3 percent to 81.19 U.S. cents at 11:06 a.m. in New York from 83.73 cents in New York yesterday, when it fell to 79.66 cents, its weakest since May 25. It fell 3.6 percent to 62.12 yen from 64.45 yen.
Australia’s dollar fell 1.7 percent to $1.0176 from $1.0355 yesterday, when it touched 99.28 U.S. cents, the lowest since March 18. The Aussie fell 2.3 percent to 77.88 yen from 79.70 yen.
The Fed yesterday pledged to keep its benchmark interest rate at a record low at least through mid-2013. The Federal Open Market Committee discussed a range of policy tools to bolster the economy and it’s “prepared to employ these tools as appropriate,” it said in a statement in Washington.
Australia’s sentiment index slid 3.5 percent in August to 89.6 from a month earlier, the lowest since May 2009, according to a Westpac Banking Corp. (WBC) and Melbourne Institute survey of 1,200 consumers taken Aug. 1-6 and released today in Sydney.
To contact the reporter on this story: Kristine Aquino in Singapore at kaquino1@bloomberg.net
To contact the editor responsible for this story: Rocky Swift at rswift5@bloomberg.net
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