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AUD/USD Surges to 0.8810 after Building Data

Australia’s dollar rallied from an eight-month low after data showed building permits in the nation increased more than economists had forecast and China’s policy makers eased property restrictions.

A gauge of price swings in the dollar versus the yen was near the highest close in seven months as investors weighed strengthening U.S. data against concern the Japanese currency’s weakness has been too rapid. The dollar’s 14-day relative strength index against the yen has been above the threshold that signals excessive gains on all but one day since August. The euro approached the weakest in two years ahead of a European Central Bank meeting today.

“Reports from China on some policy easing plus the data today on housing approvals have given the Aussie some support,” said Greg Gibbs, the head of Asia-Pacific markets strategy at Royal Bank of Scotland Group Plc in Singapore. “This is just the market reassessing where the Aussie should trade after a very sharp move lower over the past month.”

Bloomberg [1]

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