The Australian and New Zealand currencies managed to pare losses in today's trading as investors thrived on confidence that the Japanese government will soon intervene to strengthen the yen.

The Australian dollar was at 89.70 U.S. cents from 89.63 cents yesterday, when it touched 89.14 cents, the weakest since July 29. It has fallen 2.3 percent since Aug. 6. The currency advanced to 77.18 yen from 76.99 yesterday.

The New Zealand's dollar jumped by the most in more than a week against the greenback and the yen after the government said second-quarter retail sales climbed at the fastest pace since 2007.

The so-called kiwi erased four days of losses versus the yen as sales rose 1.3 percent in the three months ended June 30, adjusted for inflation, from the first quarter, beating the median estimate for a 0.3 percent increase.

Currency markets reacted to reports that Japanese Prime Minister Naoto Kan and Bank of Japan Governor Masaaki Shirakawa may meet next week to discuss measures to further strengthen the yen.

"The strong retail sales data came as a relief and helped ease concerns in New Zealand's economy," said an analyst at Macquarie Group Limited.