Australian Dollar Gains on Gold Prices; N.Z. Currency Advances


Staff member
Nov 30, 2008
The Australian dollar rose as the price of gold, the nation’s third most-valuable raw material export, gained to an 11-week high after Israel bombed Hamas in the Gaza Strip. New Zealand’s currency advanced.

The currencies also strengthened before reports this week that economists expect will show U.S. manufacturing shrank at the fastest pace since 1980. Prices of gold and crude oil rose for a second day after Israeli air strikes in the Gaza Strip killed at least 285 people and ignited protests throughout the Arab world.

“The Aussie is benefiting from the improved tone in gold,” said Robert Rennie, chief currency strategist in Sydney at Westpac Banking Corp. “The Aussie will remain within a 67.50 and 70 range for the remainder of this year,” he said referring to the currency by its nickname.

Australia’s currency rose 0.4 percent to 68.69 U.S. cents as of 4:23 p.m. in Sydney from 68.40 cents late in New York on Dec. 26. The currency advanced 0.1 percent to 62.16 yen.

New Zealand’s dollar gained 0.4 percent to 57.75 U.S. cents from 57.55 in New York late last week. It bought 52.30 yen from 52.28.

The Institute for Supply Management’s December factory index dropped to 35.4, the lowest reading in almost three decades, according to the median estimate of economists surveyed by Bloomberg News.

Gold rose as much as 2.4 percent to $890.49 an ounce, the highest since Oct. 10, after Israel called up reservists following two days of air attacks against the Hamas-led Gaza Strip. Crude oil gained as much as 5.6 percent. The Middle East produces almost a third of the world’s oil.