The Aussie extended its losses against the US dollar on Thursday after a domestic report from the nation showed the unemployment rate rose to the highest since August 2009, as traders continue to speculate about the Federal Reserve (Fed) tapering. The New Zealand dollar advanced after the central bank signaled it would increase interest rates if needed.
The Australian dollar dropped 0.26% lower to $0.9024 against the US dollar as of the time of writing, extending a loss of 1.1% from the previous session. At the same time; it declined 0.32% to a$1.5279 against the euro and stood at 0.16% to ¥92.57.
Australia’s jobless rate rose 5.8% higher in November, from 5.7% recorded in the previous month, according to the statistics bureau reports from Sydney. The number of unemployed people rose by 3,400 to 712,500 in November. Businesses in Australia added 21,000 jobs, doubling analysts’ forecasts.
The US dollar is buoyed by speculations that the Federal Reserve (Fed) will begin to scale-back on its bond buying program at one of its two meetings scheduled for December 17-18.
The New Zealand dollar extended gains against the US dollar, rising 0.32% higher to $0.8283 as of the time of writing and a five-year high versus the Australian dollar at 0.42% up to NZ$1.0913.
The kiwi’s advance came after the Reserve Bank of New Zealand (RBNZ) hinted it would increase key interest rates to stay with the inflation target of 1% to 3%.
“Annual CPI inflation increased to 1.4% in the September quarter and inflation pressures are projected to increase,” Reserve Bank of New Zealand Governor Graeme Wheeler said, warning that inflation pressures are starting to emerge. “The extent and timing of such pressures will depend largely on movements in the exchange rate, changes in commodity prices, and the degree to which momentum in the housing market and construction activity spills over into broader cost and price pressures,” he added.
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