By Yoshiaki Nohara June 9 (Bloomberg) -- The Australian and New Zealand dollars fell against most of their major peers as Asian stock losses added to concern the global economic recovery is slowing. The two currencies weakened for the third time in four days against the yen before a report forecast to show U.S. retail sales advanced at a slower pace last month. Australia’s dollar also dropped as the nation’s consumer confidence declined for a third month and home-loan approvals fell. “There’s little good news and investors can’t buy riskier assets such as stocks,” said Yuichi Onsen, chief strategist at T&D Asset Management Co. in Tokyo, which helps oversee about $18 billion. “It’s inevitable the global economic recovery will slow.” Australia’s dollar fell to 82.10 U.S. cents as of 1:53 p.m. in Sydney from 82.78 cents in New York yesterday, when it weakened to 80.83, the lowest since May 25. The currency dropped 0.9 percent to 75.06 yen. New Zealand’s dollar declined 0.8 percent to 66.18 U.S. cents and slipped 0.8 percent to 60.55 yen. The MSCI Asia Pacific Index of shares fell 0.9 percent, its third decline in four days. An index of Australian consumer confidence slid 5.7 percent this month, Westpac Banking Corp. and the Melbourne Institute reported today in Sydney. The number of loans granted to build or buy houses and apartments in Australia declined 1.8 percent in April, the statistics bureau said. Growth in U.S. retail sales slowed to 0.2 percent in May from 0.4 percent in April, according to a Bloomberg News survey of economists before the June 11 report. ‘Very Uncertain’ Reserve Bank of Australia Governor Glenn Stevens said there is little evidence so far that Europe’s debt turmoil is hurting Australia’s economy. “Australia’s budgetary position is very different from those in Europe and, for that matter, most countries,” Stevens said today in Sydney. “Public debt is low and budget deficits are under control and already scheduled to decline.” The Aussie has fallen 10 percent this quarter against its U.S. counterpart, the biggest drop since the last three months of 2008. New Zealand’s dollar has declined 6.7 percent over the same period. HSBC Plc dropped its forecast for the Aussie to reach parity with the dollar by year-end, citing a “bumpy and volatile ride” ahead on the risk China’s property bubble will deflate. The currency will trade at 85 U.S. cents by December, analysts led by David Bloom, global head of currency strategy at HSBC in London, wrote in a note to clients. “Particularly when it comes to China there’s risks, as we’ve seen historically, of China over-tightening and the property market facing a very significant slowdown,” Richard Yetsenga, a currency strategist at HSBC in Hong Kong, said today by phone. Removing Stimulus Losses in the New Zealand dollar were tempered on speculation the central bank will increase its official cash rate to 2.75 percent from a record low 2.50 percent at a meeting tomorrow. There is a 74 percent chance of a rate increase, according to a Credit Suisse AG index based on swaps. Reserve Bank of New Zealand Governor Alan Bollard said in a statement on April 29 that the bank expects to “begin removing policy stimulus over the coming months, provided the economy continues to evolve as projected.” The central bank will “follow its commodity producing peers in Australia and Canada by initiating a tightening cycle,” Todd Elmer, a currency strategist at Citigroup Inc. in New York, wrote in a note to clients yesterday. “With recent domestic data having surprised on the upside, there appears to be little reason for the RBNZ to backtrack on its guidance.” Australian government bonds rose. The yield of the benchmark 4.5 percent bond due April 2020 fell two basis points to 5.32 percent, according to data compiled by Bloomberg. A basis point is 0.01 percentage point. New Zealand’s two-year swap rate, a fixed payment made to receive floating rates, rose to 4.29 percent from 4.28 percent. To contact the reporter on this story: Yoshiaki Nohara in Tokyo at ynohara1@bloomberg.net.

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