The Australian Dollar hit an 18-year high after the release of a government report which revealed that the Australian economy grew at its fastest pace in more than three years. This has increased the possibility if earlier intervention by the Reserve Bank of Australia. The Australian Dollar has also reached a 15 year high against the Japanese Yen. ''A rate rise this year is very much on the cards,'' said Benjamin Pedley, who helps manage about $63 billion of assets at the unit of Liechtenstein's LGT Group in Singapore. ''People should hang in there and stay long on the currency.'' A trader is long a currency when they bet it will rise. Gross Domestic Product (GDP) has also increased 1.6 percent from the fourth quarter.
In the foreign-exchange, the Australian Dollar was worth 84.34 U.S. cents compared to 83.82 before the report. It reached a high of 84.39 U.S. cents, which is its strongest level since February 1989. Against the Japanese Yen, it bought 102.37 Yen compared to 101.77 before the report. It reached a high of 102.41 Japanese Yen which is the highest since April 1992. ''There's an increased likelihood the RBA will increase rates,'' said John Kyriakopoulos, a currency strategist at National Australia Bank Ltd. in Sydney. ''That has given the Australian dollar some more yield support.'' The currency will reach 86 cents in the next few months, Kyriakopoulos said.
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