Australia’s dollar climbed to the strongest in almost two weeks as traders bets reflected increased expectations the Reserve Bank won’t cut borrowing costs this year, buoying demand for the currency.
The Aussie headed for a five-day gain versus most of its major peers before a private report next week on service industries in China, Australia’s biggest trading partner. New Zealand’s currency has risen this week, rebounding from a loss in the period through Sept. 27 that was the biggest in a month.
“We’ve shifted up our year-end forecast for the Australian dollar,” said Robert Rennie, the Sydney-based chief currency strategist at Westpac Banking Corp. (WBC), which sees the Aussie at 95 U.S. cents by Dec. 31 from 92 cents previously. “Australian households are showing less signs of risk aversion. We’ve seen signs of stabilization and improvement in China.”
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