Australian, N.Z. Dollars Fall on China Comments, Japanese Data

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Nov 30, 2008
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The Australian and New Zealand dollars fell for the first time in five days after China said the U.S. currency’s may continue to dominate foreign-exchange markets, boosting demand for the greenback.

The Australian and New Zealand currencies extended declines after Japanese reports showed industrial output rose less than economists expected in May and retail sales declined. The U.S. dollar gained against 15 of the 16 major currencies after Guan Tao, deputy head of the international payment department at the State Administration of Foreign Exchange, said the currency’s role is supported by the U.S.’s “super-strong comprehensive national power,” in an article in Chinamoney Magazine.

“There isn’t a realistic alternative to the U.S. dollar at the moment,” said Joseph Capurso, a currency strategist in Sydney at Commonwealth Bank of Australia, the nation’s biggest mortgage lender. The Australian dollar “won’t get below 79 cents this week, with a fair bit of support around the high 78- cent level,” he said.

Australia’s currency fell 1.2 percent to 79.87 U.S. cents as of 4:35 p.m. in Sydney from 80.79 cents in New York last week. The currency declined 0.9 percent to 76.20 yen.

From Bloomberg News.