The Australian and New Zealand dollars rose after data showed China’s industrial production grew more than economists had estimated, boosting demand for the South Pacific nations’ exports. The Aussie gained against 13 of its 16 major counterparts after China’s inflation accelerated in line with analysts’ forecasts, easing concerns the government of the fastest-growing major economy would take measures to cool its expansion. The New Zealand dollar also advanced as stock gains boosted demand for growth-sensitive currencies. “China’s demand- or internally-driven growth is still pretty strong: That’s positive for risk currencies,” said Jonathan Cavenagh, a foreign-exchange strategist in Singapore at Westpac Banking Corp., Australia’s second-largest lender. “The fact that the CPI wasn’t stronger than expected means maybe less need to tighten policy.” Australia’s dollar rose to $1.0633 as of 2:27 p.m. in Sydney from $1.0602 in New York yesterday, when it reached $1.0521, the lowest since May 26. The currency advanced to 85.32 yen from 85.07 yen. New Zealand’s dollar climbed to 81.84 U.S. cents from 81.55. It strengthened to 65.67 yen from 65.44. China’s industrial production increased 13.3 percent in May from a year earlier, the Beijing-based National Bureau of Statistics reported today. That’s more than the 13.1 percent growth predicted by economists in a Bloomberg News survey. Consumer prices in China rose 5.5 percent in May from a year earlier, matching the median of economists’ estimates. The MSCI Asia Pacific Index of regional shares rose 1.1 percent. ‘Slowdown in China’ Gains in the Australian and New Zealand dollars were tempered after China National Radio reported today, without citing anyone, that the nation may raise interest rates in late June or early July because of estimates for greater consumer- price increases in June. “A slowdown in China is a possibility in the second half of the year,” said Imre Speizer, a strategist in Auckland at Westpac Banking Corp. “It’s another negative for risk appetite. I am bracing for a period of risk aversion, which might last many weeks.” Ten-year Australian bond futures for June delivery were little changed at 94.825 on the Sydney Futures Exchange. The yield on Australia’s 10-year note held at 5.18 percent, according to data compiled by Bloomberg. New Zealand’s two-year swap rate, a fixed payment made to receive floating rates, fell to 3.33 percent from 3.35 percent. To contact the reporter on this story: Yoshiaki Nohara in Tokyo at ynohara1@bloomberg.net To contact the editor responsible for this story: Rocky Swift at rswift5@bloomberg.net

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