The
Australian dollar weakened versus its major peers amid speculation the U.S.
Federal Reserve will continue to reduce stimulus that has buoyed asset prices
around the world.
The
Aussie held its biggest decline in three weeks against the greenback before
minutes are released of the Fed’s meeting last month, when policy makers decided
to begin tapering bond purchases. A gauge of construction activity in Australia
declined in December, a report today showed. The nation’s currency traded near
a five-year low versus its New Zealand counterpart.
Australia’s
dollar fell 0.1 percent to 89.17 U.S. cents as of 11:04 a.m. in Sydney from
yesterday, when it declined 0.5 percent. It was little changed at NZ$1.0774,
extending yesterday’s 0.4 percent drop. It touched NZ$1.0733 on Dec. 18, a
level unseen since October 2008. New Zealand’s currency weakened 0.1 percent to
82.76 U.S. cents.
San
Francisco Fed President John Williams said yesterday quantitative easing will
probably end this year if the recovery unfolds as expected. The central bank
may reduce its purchases in $10 billion increments and end the program in
December 2014, according to the median estimate of economists surveyed by
Bloomberg on Dec. 19.
The
Australian Industry Group’s construction index fell to 50.8 in December from
55.2 the previous month, according to a report today. Readings above 50 signal
expansion.
(Source: Bloomberg)