Australia’s dollar held a two-day gain versus the greenback as Asian shares rallied and before U.S. data that may add to the case for the Federal Reserve to maintain stimulus.
The Aussie strengthened against most of its 16 major peers after report showed that private sector credit increased in April. Interest-rate swaps data compiled by Bloomberg signaled an 81 percent chance the Reserve Bank of Australia will hold its benchmark interest rate at 2.75 percent next week. The New Zealand dollar maintained gains after the nation’s terms of trade rose more than economists estimated.
“I don’t think the Fed is going to taper any time soon,” said Derek Mumford, a director at Rochford Capital, a currency risk-management company in Sydney. “The U.S. dollar strength is not entirely justified. The Aussie is still struggling to get to 97 cents, but if it does break above it, there will be stop-losses which could see it spike up to 97.80.”
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