The New Zealand dollar advanced today, rising for the fourth straight session versus its US counterpart, as the Federal Reserve hinted that the third round of quantitative easing is still possible.
Investors had almost given up hope that the Fed would initiate QE3. Yet the minutes of the last policy meeting showed that some stimulus measures may be implemented and rather soon. The minutes said:
Many members judged that additional monetary accommodation would likely be warranted fairly soon unless incoming information pointed to a substantial and sustainable strengthening in the pace of the economic recovery.
Some worries remained ahead of today’s manufacturing data from China and Europe as forecasters predicted slowdown. The MSCI Asia Pacific Index of shares declined 0.5 percent.
NZD/USD rose from 0.8139 to 0.8177 and NZD/JPY advanced from 63.90 to 64.21 as of 3:54 GMT today. EUR/NZD fell from 1.5385 to 1.5326.
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