May 18, 2011, 2:36 AM EDT MORE FROM BUSINESSWEEK Aussie Falls Versus Kiwi After Wages Rise Less Than Expected Aussie Dollar Holds Gain on Speculation Wage Growth Accelerated Australian Dollar Gains Versus Yen on Prospects for Rate Boost Aussie Dollar Erases Gain as RBA Says Currency Curbing Inflation Australian Dollar Rises as Commodities Erase Loss; Kiwi Weakens STORY TOOLS e-mail this story print this story 0digg add to Business Exchange By Ron Harui May 18 (Bloomberg) -- The New Zealand dollar rose for a second day versus the U.S. currency as gains in Asian stocks supported demand for higher-yielding assets. New Zealand’s currency also strengthened versus all of its 16 major counterparts after a government report showed producer prices increased in the first quarter. Australia’s dollar fell against the yen after Moody’s Investors Service cut its credit ratings on the country’s four biggest banks. “Economies in Asia look solid, while America’s economy seems a bit soft amid mixed data,” said Marito Ueda, senior managing director in Tokyo at FX Prime Corp., a foreign-exchange margin company. Commodity currencies “are likely to be strong.” New Zealand’s dollar climbed to 78.92 U.S. cents as of 4:05 p.m. in Sydney from 78.49 cents in New York yesterday. The so- called kiwi rose 0.2 percent to 64.02 yen. Australia’s dollar traded at $1.0631 from $1.0627, after earlier advancing 0.4 percent. The currency fell 0.2 percent to 86.36 yen. The MSCI Asia Pacific Index of shares advanced 1.1 percent, snapping a four-day decline. Benchmark rates are 2.5 percent in New Zealand and 4.75 percent in Australia, compared with as low as zero in the U.S. and Japan, attracting investors to the South Pacific nations’ higher-yielding assets. New Zealand’s Prices Statistics New Zealand said producer input prices gained 2.2 percent in the first three months of the year from the previous quarter and output prices advanced 1.7 percent. New Zealand’s currency was also supported by an industry report that showed consumer confidence improved in May for the first time in four months. The ANZ-Roy Morgan confidence index climbed to 103.2 from 101.4 in April, according to an e-mailed statement from Wellington-based ANZ National Bank Ltd. today. A number greater than 100 shows optimists outnumber pessimists. Australia’s dollar trimmed gains versus the greenback after Moody’s downgraded to Aa2 from Aa1 the long-term, senior unsecured debt ratings of Australia and New Zealand Banking Corp., the Commonwealth Bank of Australia, National Australia Bank and Westpac Banking Corp. --Editor: Rocky Swift, Nicholas Reynolds To contact the reporter on this story: Ron Harui in Singapore at rharui@bloomberg.net. To contact the editor responsible for this story: Rocky Swift at rswift5@bloomberg.net.

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