Australian dollar gets a lift from kiwi, euro selling

The Australian dollar held firm against the US currency on Tuesday, according to Business Recorder, helped by buying against the New Zealand dollar and the euro. The Aussie stood at $0.6968 after a 0.3% overnight gain, moving away from a 13-week low of $0.6904. Local bonds also resisted a broad sell-off in US Treasuries.

Weakness in the euro gave the Aussie an indirect boost, as political worries pushed the single currency to its weakest level since late 2024, at A$1.6061. Against the kiwi, the currency gained 0.6% to NZ$1.2464, close to its recent high of NZ$1.2488. Australian 10-year yields moved near 15-year highs at 5.408%, yet still beat Treasuries, with the spread narrowing to 10 basis points from 39 a month before.

The Reserve Bank of Australia pushed borrowing costs up by a full point, to 4.60%, and a survey released Tuesday found consumer confidence took a hard hit after last week's fourth increase, following steep house price falls. Markets are betting the central bank will hold off in November, though it could lift rates to 4.85% early next year if inflation does not cool as hoped. In New Zealand, the kiwi held near $0.5598 after dipping to a 10-month low of $0.5581 overnight, matching a level last seen in November last year.