“Australia’s dollar fell to an almost eight-month low after a report showed building approvals unexpectedly declined, adding to speculation the Reserve Bank will cut interest rates this year.
The New Zealand dollar and the so-called Aussie slid against most of their 16 major peers after China’s Purchasing Managers’ Index for services industries indicated the slowest expansion in five months. China is the largest trading partner for both Australia and New Zealand.
“Today’s data continues to paint a picture of a fairly weak domestic economy,” said Jonathan Cavenagh, a currency strategist at Westpac Banking Corp. (WBC) in Singapore. “Some of the softness in the Asian data is also not helping Australia. Price action for the Aussie is pretty negative at the moment.”
The Australian dollar dropped 0.8 percent to $1.0125 as of 4:49 p.m. in Sydney, after touching $1.0117, the lowest since July 12. It fell 0.9 percent to 94.61 against the yen.
The New Zealand dollar declined 0.6 percent to 82.03 U.S. cents, after falling to 81.96 cents, the lowest since Dec. 31. The so-called kiwi slid 0.8 percent to 76.64 yen.
Australian home-building approvals declined in January for a second-straight month. The number of permits granted to build or renovate houses and apartments fell 2.4 percent from December, when they fell a revised 1.7 percent, the Bureau of Statistics said in Sydney today. The median economist forecast was for a 2.8 percent gain in a Bloomberg News survey.
