Australian Dollar Falls from a Three-Month High

The Australian dollar fell from a three-month high after a government report on wages failed to beat expectations, giving traders an excuse to sell the currency., Bloomberg 2/19/2008 6:58:01 PM

The local dollar ended four days of gains after the Bureau of Statistics said hourly rates of pay excluding bonuses rose 4.2 percent last quarter from a year earlier, matching the pace from the third quarter and the median estimate of a Bloomberg News survey of economists. Australia's dollar weakened against 13 of the 16 most-active currencies after Asian stocks declined.

The Australian dollar weakened 0.3 percent to 91.89 U.S. cents as of 12:22 p.m. in Sydney, from 91.95 immediately before the report and 92.14 cents in late Asian trading yesterday. It earlier touched 92.37, the highest since Nov. 9. It fell to NZ$1.1513 from NZ$1.1525, as the MSCI Asia-Pacific Index excluding Japan declined 0.5 percent.

Australia's currency also slipped after Westpac Banking Corp. and the Melbourne Institute said today the nation's leading economic index, a gauge of future growth, fell 0.2 percent in December to 255.5 points, the first decline since February 2005.

The local dollar is still the best performer in the world in the past week. Investors have flocked to the Australian dollar after minutes of the central bank's latest meeting released yesterday showed policy makers discussed a 0.5 percentage point increase in rates when they raised borrowing costs by half that amount to an 11-year high of 7 percent this month.

Australian Dollar Falls from a Three-Month High