“Australia’s dollar declined against most of its major peers after a preliminary survey showed China’s manufacturing is expanding at a slower pace, dimming the outlook for South Pacific nation’s exports.
Local bonds and the so-called Aussie fell versus the U.S. currency as Italy’s general election result estimates due today curbed demand for riskier assets. Australia’s dollar reached a 4 1/2-year high against the yen on speculation Japan’s government will nominate as central-bank head Haruhiko Kuroda, who has said expanding monetary stimulus can be justified.
“It’s a surprisingly softer number, suggesting that the Chinese economy is pulling back a little,” said Greg Gibbs, a Singapore-based senior currency strategist at Royal Bank of Scotland Group Plc. “It has contributed to some softness in the Australian dollar. The Aussie is in a gradual downtrend.”
The Australian dollar declined 0.4 percent to $1.0278 at 4:59 p.m. in Sydney from the end of last week. It touched 97.73 yen, the highest since August 2008, before trading at 96.81, 0.4 percent above the close on Feb. 22. New Zealand’s dollar slid 0.1 percent to 83.71 U.S. cents. The kiwi climbed 0.7 percent to 78.85 yen, adding to a 0.8 percent gain on Feb. 22.
The yield on Australia’s 10-year bonds fell three basis points, or 0.03 percentage point, to 3.51 percent.
The preliminary reading of a Purchasing Managers’ Index fell to 50.4 in February from 52.3 in January, according to a statement from HSBC Holdings Plc and Markit Economics today. That compared with the 52.2 reading expected by economists surveyed by Bloomberg News. China is Australia’s biggest trading partner and New Zealand’s second-largest export market.
