Aussie Trading Near 1.0460 on Stock Gains and U.S. Budget Optimism

Australia’s dollar traded 0.3 percent from a two-month high after equities rebounded globally on speculation the U.S. will avoid the so-called fiscal cliff, boosting demand for higher-yielding assets.

The New Zealand dollar remained higher versus the greenback after U.S. Republican House Speaker John Boehner said he’s optimistic officials can “avert this crisis sooner rather than later.” Demand for the so-called Aussie was limited after a report showed Australia’s business investment grew at a slower pace in the third quarter, supporting expectations that the central bank will cut interest rates next week.

“Everybody expects some resolution to the fiscal cliff,” said Hans Kunnen, the chief economist at St. George Bank Ltd. in Sydney. “The better the solution, the smoother it is, the easier it will be for the economies to grow, which is good for Australia’s dollar.”

The Australian dollar slipped 0.1 percent to $1.0464 as of 1:23 p.m. in Sydney from yesterday, when it gained 0.3 percent. It touched $1.0490 on Nov. 27, the highest since Sept. 21. The Aussie was little changed at 85.94 yen. The currency was poised for a 0.9 percent monthly gain against the greenback and 3.8 percent jump versus the yen.

via Bloomberg

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