The Australian dollar rallied after consumer prices in China increased more than economists estimated, supporting demand for higher yielding assets.
New Zealand’s dollar rose versus most of its major peers as Asian stocks extended gains and food prices in the nation rebounded. Australian bonds extended yesterday’s advance. Reserve Bank Assistant Governor Christopher Kent said today a weaker currency will help the economy return to trend growth and signaled there may be a correction in the exchange rate.
“The Aussie does seem bid quite well,” said Divya Devesh, a foreign-exchange analyst at Standard Chartered Plc in Singapore. “There’s little reason to be pessimistic about China. Compared to January, risk appetite looks much better.”
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