The Australian dollar advanced as stocks and commodities rallied after the Federal Reserve released the minutes of its monetary policy meeting, indicating that the US economy is improving.
The Fed indicated that the US economy “has been expanding moderately” (previously the US central bank was saying that the recovery is proceeding with “modest” pace). Chairman Ben Bernanke didn’t mention a new round of quantitative easing, but analysts said that his words hinted that the possibility for more stimulus still remains in the cards.
It was good for markets that traders’ attention turned to the United States as America remains one of just few sources for optimism among investors. Stocks and commodities rallied after the Fed minutes and Australian currency profited from the rally. The Thomson Reuters/Jefferies CRB Index of commodities gained 0.7 percent and the MSCI World Index advanced as much as 1.5 percent yesterday.
EUR/AUD fell from 1.2410 to 1.2392 and AUD/JPY went up from 87.32 to 87.73 as of 5:25 GMT today. AUD/USD advanced from 1.0517 to 1.0538 yesterday and traded near 1.0542 today.
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