Australia’s dollar slid to the lowest in almost three years before U.S. jobs data that may add to the case for a reduction in Federal Reserve stimulus, which has supported higher-yielding assets globally.
The Aussie fell for a fifth day before Reserve Bank of Australia officials gather for a monetary policy decision next week, where they are expected to lower borrowing costs. New Zealand’s kiwi dollar held a four-day decline.
“The risk is that Aussie and kiwi do weaken on the back of a stronger payrolls number,” said Peter Dragicevich, a Sydney-based currency economist at Commonwealth Bank of Australia (CBA), the nation’s largest lender. Improving U.S. data “would just reinforce expectations that the Fed will begin to taper asset purchases over the next few months.”
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