Aussie Falls After Stevens Says Currency 'Uncomfortably High'
The Australian dollar fell after Reserve Bank Governor Glenn Stevens said the currency is 'uncomfortably high' after he and his board refrained from cutting borrowing costs at a policy meeting today.
The Aussie slid versus all of its 16 major counterparts as Stevens made the comment after saying last week that the currency may become 'materially lower.' New Zealand's dollar weakened after Asian stocks pared earlier gains.
'The RBA is still very much in a wait-and-see neutral stance,' said Greg Gibbs, a senior foreign-exchange strategist at Royal Bank of Scotland Group Plc in Singapore, referring to the Reserve Bank of Australia. 'The currency is responding to comments similar to those made by Stevens last week.'
Australia's currency fell 0.3 percent to 94.80 U.S. cents at 3 p.m. in Sydney after climbing 0.8 percent yesterday, the biggest advance since Oct. 17. It dropped 0.5 percent to 93.34 yen after touching 93.87, a one-week high. New Zealand's kiwi dollar lost 0.2 percent to 82.70 U.S. cents after rising 0.2 percent yesterday. The MSCI Asia Pacific Index of shares was little changed after climbing as much as 0.5 percent.
RBA officials kept the cash rate at a record-low 2.5 percent today, as predicted by all 31 economists surveyed by Bloomberg News before the decision.
To contact the reporter on this story: Kristine Aquino in Singapore at kaquino1@bloomberg.net
To contact the editor responsible for this story: Garfield Reynolds at greynolds1@bloomberg.net
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