Australian Dollar Advances to 18-Month High on Policy Outlook

The Australian dollar advanced to the highest level in more than 18 months versus the yen as the Bank of Japan kept interest rates near zero today, maintaining the yield advantage of the South Pacific nation over Japan.

The so-called Aussie also traded near a two-month high against the greenback and a record against the euro after a rate increase yesterday by the Reserve Bank of Australia added to the appeal of the nation’s assets. Gains in the Aussie against New Zealand’s dollar were limited after Fonterra Cooperative Group Ltd., the world’s largest dairy exporter, said milk powder prices reached a 21-month high.