The Australian Dollar rose to an 18 year high and the New Zealand Dollar hit a 7 week high on speculation that their central banks won't follow suit with the U.S. Federal Reserve with reducing interest rates. The Australian Dollar advanced for its 10th consecutive day and a 4th consecutive day for New Zealand as the yield premiums on bonds attracted funds. ``There's a broad move out of the U.S. dollar and into the high-yielders,'' said Michael Gordon, currency strategist at Westpac Banking Corp. in Wellington. The countries' borrowing costs ``are likely to stay higher and both, certainly Australia, may see rate increases at some point.'' Carry trading has also continued as Japanese investors fund their investments with higher yielding currencies such as the Australian and New Zealand Dollar.
In the forex trade, the Australian Dollar traded at 89.06 U.S. cents compared to a previous trade of 88.79 U.S. cents. It reached a high of 89.26 which is its highest level since February. 1989. It traded at 102.70 Japanese Yen compared to 101.02 Yen in a previous trade.
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