Australia, New Zealand Dollars Fall

The Australian and New Zealand dollars fell as U.S. equities and commodity prices slipped on concern a $3 trillion dollar push to shore up the global financial system may not prevent a world recession.

The Australian dollar retreated after yesterday's record gain against the yen as U.S. equities fell on speculation company earnings will weaken on slumping demand. The Australian and New Zealand currencies slid the first day in three versus the dollar as prices fell for commodities the nations export.

The Australian dollar slid 4.4 percent to 69.11 U.S. cents as of 1:28 p.m. in Sydney, from 72.28 cents late in Asian trading yesterday. The currency declined 5.6 percent to 70.07 yen, from 74.19 yen. It surged 9.8 percent against the yen yesterday, the biggest gain since the Australian currency began freely trading in December 1983.

New Zealand's dollar fell 3 percent to 61.44 U.S. cents from 63.34 cents late in Asia yesterday. It slid 4 percent to 62.40 yen.

The Australian dollar has dropped 29.4 percent against the greenback and 31.7 percent versus the yen over the past three months as commodity prices tumbled and the turmoil in financial markets prompted investors to dump higher-yielding assets. New Zealand's currency has declined 20.3 percent and 22.9 percent against the dollar and the yen, respectively.

The yen rose for the first day in five against the dollar on speculation the U.S. Treasury's $250 billion investment in financial institutions won't prevent a recession in the world's biggest economy.

The yen climbed to 101.33 per dollar as of 12:01 p.m. in Tokyo from 102.07 late yesterday in New York. The currency rose to 137.39 per euro from 139.04, set for the biggest gain in a week. The euro fell to $1.3557 from $1.3619.,
10/14/2008 8:46:43 PM