“Australia’s dollar rallied, erasing earlier losses, as traders pared bets the central bank will cut its key interest rate after data showed companies will continue to invest into next year.
The so-called Aussie dropped earlier after figures showed capital spending unexpectedly fell last quarter. New Zealand’s dollar strengthened after global stocks rallied and local data showed business confidence improved and building approvals decreased less than economists estimated. The yield on Australia’s 10-year debt rose from a five-week low.
“The information in the capital expenditure report is not enough to trigger a rate cut next week,” said Annette Beacher, Singapore-based head of Asia-Pacific research at TD Securities Inc. “The first piece of information was a weaker-than expected December quarter. The second piece of information we noticed was that 2013-2014 was stronger than expected. The Aussie seemed to have settled back at a slightly higher level after a violent movement.”
The Australian dollar added 0.4 percent to $1.0278 as of 4:26 p.m. in Sydney, after earlier falling as much as 0.4 percent. It touched $1.0184 yesterday, the lowest since Oct. 10. The Aussie jumped 0.6 percent to 94.93 yen. New Zealand’s dollar advanced 0.5 percent to 83.18 U.S. cents. The so-called kiwi rose 0.7 percent to 76.84 yen.
For the month, Australia’s currency was set for a 1.4 percent drop versus the U.S. dollar. New Zealand’s dollar was poised for a 0.8 percent decline….”
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