Australian Dollar Climbs to Highest in Three Weeks as Asian Stocks Gain

The Australian dollar climbed to its strongest level in more than three weeks as Asian stocks gained after Federal Reserve Chairman Ben S. Bernanke eased concerns the U.S. economy may stall.

The so-called Aussie appreciated against 15 of its 16 major peers before a report tomorrow that is forecast to show Australian building approvals increased in July by the most in four months and after traders trimmed bets that the Reserve Bank will reduce its benchmark interest rate this year. New Zealand’s dollar advanced before a U.S. report that economists said will show consumer spending rose last month.

“Expectations of rate cuts in Australia have been wound down and improved risk appetite following Bernanke’s comments last week is supporting the Aussie,” said Janu Chan, an economist in Sydney at St. George Bank Ltd.

Australia’s dollar strengthened to $1.0618 as of 1:54 p.m. in Sydney from $1.0573 in New York on Aug. 26 and earlier touched $1.0626, the most since Aug. 4. It gained 0.5 percent to 81.48 yen and earlier reached 81.52, the strongest since Aug. 8.

New Zealand’s dollar climbed to 84.41 U.S. cents from 84.07 cents last week and reached 84.49 cents, the most since Aug. 5. It gained 0.5 percent to 64.78 yen.

The MSCI Asia Pacific Index rose 1.7 percent. Standard & Poor’s 500 futures indicate U.S. stocks may extend last week’s gains after Bernanke on Aug. 26 signaled the economy isn’t weak enough to warrant additional stimulus. U.S. consumer spending is likely grew 0.5 percent in July according to economists surveyed by Bloomberg before today’s Commerce Department report. (Bloomberg)