The Australian dollar held near a week high before Federal Reserve Chairman Ben S. Bernanke begins a second day of testimony following remarks that signaled no imminent exit from stimulus that tends to weaken the greenback.
Australia’s 10-year government bond yield fell to a one-month low as Bernanke’s comments increased demand for sovereign debt. New Zealand’s currency held three days of gains as Asian stocks rose, supporting demand for higher-yielding assets.
“The market has initially taken Bernanke’s comments as a little bit dovish,” said Emma Lawson, a Sydney-based foreign-exchange strategist at National Australia Bank Ltd. “Given the market is so short the Aussie and people have been very bearish, there is some room for consolidation and a short-term move higher.” A short position is a bet a currency will decline in value.
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