Data this week will probably highlight a divergence in global growth. Employers in the U.S. hired more workers in November, and the government in the U.K. may raise its economic forecast for the first time in three years. Conversely, Brazil’s economy may have contracted in the third quarter for the first time in two years.
Australia’s dollar fell to a 2 1/2- month low, heading for its sixth weekly drop, after the government’s rejection of a planned foreign takeover raised concern investment flows into the country may weaken.
Reserve Bank of Australia Governor Glenn Stevens said that while the central bank has been unconvinced about the effectiveness of trying to drive down the Aussie, he remains “open-minded” on currency intervention.
Traders are adding to bets Australia’s central bank will repeat its emergency interest-rate cuts of 2008 as the economy falters and concern intensifies that U.S. and European debt burdens will derail global growth.
Bond sales by foreign borrowers in Australia are set for the slowest month in more than a year after global market turmoil helped push the discount for swapping the proceeds into U.S. dollars to the least since 2009.