“The Australian and New Zealand dollars reached the highest levels in more than four years versus the yen amid speculation the Bank of Japan (8301) will expand monetary easing, boosting the allure of higher-yielding assets.
The so-called Aussie rose against most of its major peers as investors pared bets on interest-rate cuts by the Reserve Bank of Australia. The nation’s bonds dropped, sending the 10- year yield to the highest since May. The New Zealand dollar declined against the greenback amid concern a drought in the nation will hurt its economy. Haruhiko Kuroda, the nominee to become the Bank of Japan’s next governor, yesterday signaled readiness for a quick expansion in monetary stimulus.
“The suggestion that Kuroda may ease policy before the April 4 meeting has given the yen a push lower” against crosses including the Aussie and kiwi currencies, said Michael Turner, a fixed-income strategist in Sydney at Royal Bank of Canada. “Expectations for rate cuts in Australia are falling, and as long as the data keeps printing OK, that’ll keep yields grinding higher.”
The Australian dollar rose 0.2 percent to 99.14 yen at 5 p.m. in Sydney, after earlier touching 99.58, the highest since August 2008. The currency was unchanged at $1.0281.
New Zealand’s dollar reached 79.90 yen, the highest since July 2008, before trading at 79.53, 0.3 percent below yesterday’s close. The so-called kiwi declined 0.4 percent to 82.47 U.S. cents.
BOJ Nominees
Kuroda said yesterday that the bank would consider buying derivatives as part of its easing efforts. Kikuo Iwata, a nominee for deputy governor, said today in upper house confirmation hearings the central bank can end deflation solely through buying government debt. Japan’s central bank will next meet for two days ending April 4….”
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