Australia’s dollar held losses against most of its major peers and the nation’s bonds rallied on speculation weaker economic data will add to the case for the central bank to cut interest rates.
The so-called Aussie dropped to the lowest this year against the greenback yesterday after retail sales unexpectedly fell, while figures today may show unemployment rose. The Reserve Bank of Australia said this week the inflation outlook “would afford scope to ease policy further” after it kept borrowing costs at a half-century low. New Zealand’s dollar remained lower after a report showed that employers cut jobs.
“If the employment data comes out soft, then we’re going to see RBA easing expectations ratchet up again,” said Mike Jones, a currency strategist at Bank of New Zealand in Wellington. “That will certainly provide some headwinds for the Aussie dollar.”
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