The New Zealand dollar jumped today on the speculation the US Federal Reserve will perform additional actions to support the faltering nation’s economy.
Federal Reserve Chairman Ben S. Bernanke will speak on August 26 in Jackson Hole, Wyoming. It’s there last year he has told about the second round of quantitative easing. Some traders speculate this year we would see a third round of stimulus.
Kengo Suzuki, manager of the foreign bond department at Mizuho Securities Co. explained:
The second round of quantitative easing was part of the reason behind a jump in commodity prices, so a third round would cause a similar situation.
The New Zealand currency was falling on two previous trading sessions. During the first half of the current trading session the kiwi (as the currency is nicknamed) sharply jumped. During the second half of the session the rally stalled and the kiwi started to slowly fall. Yet the currency still has kept most of its gains.
NZD/USD climbed from 0.8176 to 0.8244 as of 18:20 GMT today, while during the trading session it reached the high of 0.8278. EUR/NZD fell from 1.7568 to 1.7411. NZD/JPY rose from 62.72 to 63.25.
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