“Australia’s dollar rose against most major peers after a gauge of consumer confidence in the nation surged to a two-year high, easing expectations the central bank will cut interest rates.
The so-called Aussie extended a rebound from the lowest in four months as swaps traders reduced bets that the Reserve Bank of Australia will lower the overnight cash-rate target from 3 percent in March. The value of New Zealand’s dollar relative to its major trading partners climbed to a 5 1/2-year high as the nation’s Finance Minister Bill English said he won’t spend taxpayer money on intervention.
“The odds of a RBA rate cut in March have now slipped a little bit” after the release of the consumer-confidence survey, said Jonathan Cavenagh, a currency strategist in Singapore at Westpac Banking Corp., Australia’s second-largest lender by market value. “The near-term risks are that it can head higher,” he said, referring to the Australian dollar.
Australia’s currency gained 0.4 percent to $1.0343 as of 4:52 p.m. in Sydney after touching $1.0227 yesterday, the lowest since Oct. 15. The New Zealand dollar, known as the kiwi, added 0.2 percent to 84.17 U.S cents following a 0.6 percent advance.
Westpac and Melbourne Institute said today that their gauge for Australian consumer confidence jumped 7.7 percent in February to the highest level since December 2010.
Traders see a 41 percent chance that the RBA will cut the benchmark rate to 2.75 percent next month, according to data on overnight-index swaps compiled by Bloomberg. There was a 51 percent probability yesterday….”
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