Jan. 10 (Bloomberg) -- The Australian dollar traded near a four-week high and New Zealand's currency rose for a third day on speculation rising prices in the two economies will prevent the central banks from cutting interest rates.
The two Southern Hemisphere currencies have gained almost 1 percent this year on bets their rate advantage over the U.S. will widen as the Federal Reserve cuts borrowing costs. The currencies may rise ahead of consumer price index reports which are likely to show faster inflation, said Joshua Williamson, senior strategist at TD Securities.
``There are plenty of factors to support the Aussie and kiwi,'' Williams said in Sydney, referring to the currencies by their nicknames. ``The odds are rising for an Australian rate rise.''
The Australian dollar was at 88.28 U.S. cents at 4:54 p.m. in Sydney from 88.42 cents yesterday when it reached 88.58 cents, the strongest since Dec. 13. The currency rose to 96.81 yen from 96.70 late in Asia yesterday and reached 97.39 yen, the highest since Jan. 3.
The New Zealand dollar gained to 77.39 U.S. cents from 77.15 cents late in Asia yesterday. The currency advanced to 84.86 yen and touched 85.24 yen, the highest since Jan. 4.
Australia's dollar may gain to 88.60 cents and New Zealand's may reach 78 cents in the near term, Williamson said.
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