Australia’s dollar erased gains against its U.S. counterpart as falling Asian stocks damped demand for higher-yielding assets. The so-called Aussie strengthened earlier after data showed retail sales rose 1.1 percent in April from the previous month, beating the median forecast in a Bloomberg News survey of economists. The New Zealand dollar dropped against 14 of its peers after Auckland-based Fonterra Cooperative Group Ltd., the world’s largest dairy exporter, said whole milk powder prices fell at an auction to the lowest in more than four months. “A pessimistic outlook for the global economy is reflected in the drop in stocks,” said Daisaku Ueno, president of Gaitame.com Research Institute Ltd. in Tokyo, a unit of Japan’s largest online currency broker. “That’s weighing on the Aussie, while there is no domestic reason to sell it.” Australia’s dollar traded at to $1.0616 as of 1:46 p.m. in Sydney from $1.0614 yesterday in New York, after rising to as much as $1.0660. The currency gained 0.2 percent to 86.09 yen. New Zealand’s dollar dropped to 81.23 U.S. cents from 81.46. It fetched 65.88 yen from 65.95. The MSCI Asia Pacific Index of regional shares lost 1.8 percent today, following a 2.3 percent slide in the Standard & Poor’s 500 Index yesterday. Global equities retreated after data showed manufacturing growth from the U.S. to China and the euro region slowed last month and American employers hired fewer workers than forecast. Fonterra said near-term contracts for whole milk powder prices declined 5.7 percent to $3,760 a metric ton, the lowest since Jan. 18. To contact the reporter on this story: Monami Yui in Tokyo at myui1@bloomberg.net To contact the editor responsible for this story: Rocky Swift at rswift5@bloomberg.net

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