Australia’s dollar fell toward the lowest level in more than 11 months before U.S. data forecast to show improvements in consumer confidence and manufacturing amid speculation the Federal Reserve may slow stimulus.
The Aussie dropped against most of its major counterparts amid concern a slowdown in China will damp demand for commodity exports. Fed Chairman Ben S. Bernanke said last week the U.S. central bank may slow the pace of quantitative easing if there are signs of sustained economic growth.
“It would be interesting to see whether the expectations will continue for the Fed to wind down QE,” said Janu Chan, a Sydney-based economist at St. George Bank Ltd. “There’s a bit of uncertainty about China. Chinese data this week could increase the chance of RBA cutting sooner rather than later. I wouldn’t rule out Aussie falling further,” Chan said, referring to the Reserve Bank of Australia.
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