American focus: the the risk is off

Currencies of commodity-exporting countries tumbled versus the U.S. dollar as speculation increased that China will take more measures to cool economic growth, curbing appetite for raw materials.

The U.S. currency extended gains versus most of its 16 major counterparts after jobless claims fell more than forecast for the latest week and existing home sales increased more than projected in December. South Africa’s rand and the New Zealand, Australian and Canadian dollars dropped as prices for crude oil, gold and copper slumped.

“The Chinese numbers were the catalyst for the risk-off day,” said Paresh Upadhyaya, head of Americas Group of 10 currency strategy at Bank of America Corp. in New York. “The concerns of further Chinese tightening gathered momentum and you saw the commodity bloc currencies come under pressure.”

The South African rand fell 1.2 percent to 7.0785 per dollar at 12:11 p.m. in New York, from 6.9931 yesterday. It touched 7.1127, the weakest since Dec. 1. New Zealand’s dollar dropped 1.6 percent to 75.67 U.S. cents and the Aussie lost 1.4 percent to 98.73 U.S. cents.