This article is originally referred from Traders Trust Daily Morning Report
The Australian and New Zealand dollars gained ground against its U.S. counterpart on Wednesday, as Tuesday’s downbeat U.S. data continued to weigh on the greenback and investors eyed the Reserve Bank of New Zealand’s upcoming policy decision on Thursday.
AUD/USD gained 0.27% to 0.7694, the highest level since May 3.
The greenback weakened after data on Tuesday showed that U.S. nonfarm productivity dropped by 0.5% in the second quarter, disappointing expectations for a 0.4% rise, after a 0.6% slip in the three months to March.
The weak data overshadowed last week’s strong U.S. nonfarm payrolls report, which had boosted expectations for a rate hike by the Federal Reserve before the end of the year and sent the U.S. dollar broadly higher.
Earlier Wednesday, RBA Governor Stevens called on the government to implement further measures to boost growth and said interest rates were reaching the point where people could “no longer assume that monetary policy can simply dial up the growth we need”.
NZD/USD advanced 0.59% to trade at 0.7208.
Market participants were looking ahead to the RBNZ’s policy statement due on Thursday. The central bank was expected to lower interest rates by 0.25%.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.34% at 95.74, the lowest since August 5.
Original Source: Traders Trust Daily Morning Report