The Australian dollar strengthened against 12 of 16 major currencies after rising home loans in Australia which exceeded economists' estimates, stoking optimism about economic recovery.

Aussie is one of six major currencies outperform the dollar this month, related to the Reserve Bank of Australia (RBA) cut its target interest rate to a record low of 2% on May 5, a decrease in interest rates for the second time this year. The Australian Government's annual budget on Tuesday evening Sydney time. The US dollar rose this month as compared to other major currencies, according to data from Bloomberg, as traders assess the Federal Reserve will raise interest rates this year.

The Aussie rose 0.8% to a level of 79.55 US cents at 10:11 pm London time. While the Dollar fell 1% to a level of $ 1.1262 per euro and little changed at 120.02 yen.

Home loan approvals rose 1.6% in March from a month earlier, according to data from the statistics bureau in Sydney, on Tuesday. Estimates of economists surveyed by Bloomberg rose by 1%.
Stretch said that the budget Treasurer Joe Hockey 'background better,' then the Australian dollar could rise to a level of 79.70 US cents, although there are hints of fiscal tightening that could see the currency's decline to a level of 78.50 US cents and can also decreased.

This month, the Australian dollar has appreciated by 0.6% against the US currency, compared with an increase of 2% against the pound and followed gains of 0.7% against the Swedish krona. (KNC)