Strategists are boosting forecasts for Australia’s dollar by the most of any Group of 10 currency, betting that $190 billion of natural-gas projects will keep funds flowing into the nation as spending on mines slows.
Estimates for the Aussie by Dec. 31 have climbed 8.2 percent to $1.05, from 97 U.S. cents on June 30, according to the median of 48 strategist estimates compiled by Bloomberg. Options data show there’s a 51 percent chance the currency will exceed the forecast as traders increase bets on its advance to the highest in five weeks.
The Aussie’s 49 percent gain since the end of 2008 is the biggest among more than 150 currencies tracked by Bloomberg. The looming peak in resource investment highlighted by the Reserve Bank in November is being blunted by spending on liquefied- natural-gas projects, government debt, stocks and real estate. That’s supporting the currency, even as the worst back-to-back years of job growth since 1997 and the weakest consumer demand since July spurs prospects interest rates will fall to a record.
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