Aussie dollar strengthens to highest in nearly two weeks
Australia’s dollar strengthened to the highest in almost two weeks after a government report showed annual inflation accelerated to the fastest pace in four years and traders pared bets the Reserve Bank of Australia will cut interest rates in the next year.
The Aussie rose at least 0.3% versus all of its 16 major peers, climbing 0.6% to 94.46 U.S. cents during morning trading in London, the highest level since July 10. The euro was little changed at $1.3464 after declining to $1.3458, the weakest since November 21. The shared currency dropped 0.1% to 136.56 yen. The yen was little changed at 101.43 per dollar.
Australia’s currency advanced for a second day as the statistics bureau said the trimmed mean annual inflation rate increased to 2.9%, the highest level since the three months ended March 2010. The central bank targets inflation of between 2% and 3% on average.
The Aussie has risen 1% in the past week, the best performer of 10 developed-nation currencies tracked by Bloomberg Correlation-Weighted Indexes. The dollar rose 0.2%, the yen gained 0.5%, while the euro dropped 0.4%.
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