The Australian dollar neared a seven-week high against the U.S. dollar as modestly firmer stocks late in the U.S. session Tuesday signalled a pick up in risk sentiment. The dearth of overnight U.S. data to consider contributed to generally lacklustre trading. A more risk averse environment earlier overnight had supported safe havens like the U.S. and Japanese currencies. The yen also found support from repatriation flows that are customary this time of year ahead of Japan’s fiscal year-end on March 31. Worries about the fiscal health of the UK and Portugal weighed on investors’ willingness to take on risk. Fitch Ratings agency on Tuesday expressed concern with the state of Britain’s fiscal health, saying that conditions had deteriorated. Fitch also singled out Portugal for its gradual approach to improve its fiscal health which could eventually lead to a downgrade of its AA rating. The Aussie dollar rose to a new 25-year peak on the UK pound, a currency that is also experiencing political and economic headwinds. The ongoing worries about the fiscal health of peripheral economies in the euro zone helped to push the Australian currency to a new record peak against the single currency. Investors on Wednesday will focus on local data on consumer sentiment and housing finance. Market participants will also tune in to a speech this morning by RBA assistant governor Lowe for clues on the outlook for monetary policy.