Australian Dollar Rises as Commodities Gain

The Australian dollar rose as prices of commodities increased, bolstering the outlook for the nation's export earnings.

Australia's dollar also gained versus the yen as the Reuters/Jeffries CRB Index of 19 raw materials climbed for a second day. Australia's currency was supported by speculation its 10 percent drop over the past month was too rapid.

The Australian dollar climbed 0.5 percent to 87.29 U.S. cents as of 10:46 a.m. in Sydney from 86.88 cents late in Asia yesterday. It has gained 1.5 percent since reaching 85.93 cents on Aug. 13, the lowest since Jan. 23. The currency strengthened 0.6 percent to 95.89 yen from 95.33 yen.

The Australian dollar is highly influenced by raw material prices because overseas shipments of commodities account for about 17 percent of the country's economy. Gold, Australia's third-most valuable commodity export behind iron ore and coal, gained for a third day to trade at $817.31 an ounce.

Australian Dollar Rises as Commodities Gain, Bloomberg
8/19/2008 7:49:38 PM