The so-called Aussie weakened versus all of its 16 major peers after the data on gross domestic product outweighed figures showing increases in China’s industrial production and retail sales, boosting pressure on Premier Wen Jiabao to loosen policy further. The New Zealand dollar rose as Asian stocks extended a global rally, supporting demand for riskier assets.
“The GDP number was in line with our expectations, but the market is still surprised,” said Sue Trinh, a senior foreign- exchange strategist at Royal Bank of Canada in Hong Kong. “We’re going to be watching at any increase in speculation of monetary-policy easing by the Chinese authorities, which may at least help to prevent a deeper retracement in the Aussie.”
Australia’s dollar fell 0.4 percent to $1.0395 as of 12:33 p.m. in Sydney from yesterday in New York. It earlier touched $1.0453, the highest since April 3, and is headed for a 0.8 percent advance this week, the biggest gain since the five days ended Feb. 3. The Aussie slid 0.3 percent to 84.22 yen.
New Zealand’s currency touched 83.20 U.S. cents, the strongest since March 2, before trading at 83.92, 0.2 percent above yesterday’s close. The kiwi gained 1.2 percent this week. It rose 0.5 percent to 67.29 yen from yesterday.
China Growth
In China, GDP expanded 8.1 percent from a year earlier, the least in almost three years, after an 8.9 percent gain in the fourth quarter, the National Bureau of Statistics said in Beijing today. The median estimate in a Bloomberg News survey of 41 economists was 8.4 percent. Industrial production rose at a faster pace in March while retail sales growth accelerated.
Australian bonds have gained this week, pushing down the yield on 10-year debt to 3.87 percent from 4.06 percent on April 5, before the Easter holidays. The yield on 3-year debt has fallen to 3.29 percent, and is set for a fourth week of declines. That’s the longest series since November.
Australian government securities “remain one of the world’s ‘cleanest dirty shirts’ for risk-averse investors, especially as the federal budget moves back into surplus and issuance levels reduce,” Robert Mead, a Sydney-based portfolio manager at Pacific Investment Management Co., wrote in an e- mailed note today. Pimco runs the world’s largest bond fund.
The MSCI Asia Pacific Index (MXAP) of stocks advanced 0.8 percent following a 1.4 percent rally in the MSCI World Index of stocks yesterday. The Thomson Reuters/Jefferies CRB Index (CRY) of raw materials added 1.2 percent yesterday.
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