SYDNEY (Reuters) – The Australian and New Zealand dollars held near 2-1/2 week highs on Monday as risk assets came back in vogue amid expectations policymakers around the world will take measures to support slowing economic growth.
Three developments on Friday gave the antipodean currencies a leg-up. First, Beijing announced a new round of trade talks with Washington. Then, China aggressively eased monetary policy, slashing bank reserve requirements to prop up the country’s economy.
Investors - US - Federal - Reserve - Jerome
And investors got more to cheer about when U.S. Federal Reserve chair Jerome Powell said he would be patient and flexible on interest rate hikes.
These proved a much-needed tonic for global shares and sent the risk-sensitive Australian dollar to $0.7127, the highest since mid-December. The currency was last at $0.7120.
Aussie - Tailspin - Week - Whispers - Recession
The Aussie and kiwi went into a tailspin last week as whispers of a possible recession in the United States grew louder, making some investors start pricing in a cut in the Fed funds rate in 2019.
Uncertainties stemming from a Sino-U.S. trade war...
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