By TraderVox.com
Tradervox.com (Dublin) – South pacific dollars rose to new records against the euro after Bank of China and Bank of England joined with European Central Bank to boost economic growth. The New Zealand dollar increased against most of its counterparts as the country’s budget deficit was announced by the Treasury department yesterday showing a narrower deficit than expected. The Australian currency advanced against most of its sixteen counterparts as Chinese monetary policy makers lowered interest rates for the second time. This also came as ECB lowered interest rate to 0.75 percent, the lowest since the single currency bloc was introduced. Further, the Bank of England decided to expand its quantitative easing program as it starts efforts to prevent the UK economy from going back into recession.
According to Camilla Sutton who is a currency strategist at Bank of Nova Scotia in Toronto, the global central banks’ response to the crisis in Europe has increased the demand of riskier assets which has usurped the need for safe haven. She added that the action has given investors some confidence that central banks are committed to establishing a firmer financial market. The Australian dollar increased prior to Wayne’s discussion in Hong Kong about strategies of improving foreign exchange trade between China and Australia. China is Australia’s biggest trading partner. The Bank of China also dropped its interest rates for the second time in a month to spur growth in the country.
The Australian dollar increased against the euro by 1.2 percent to trade at A$1.2045 per euro during yesterday’s trading in New York. It had touched its strongest against the euro earlier when it reached A$1.2022 which is the strongest since the currency was introduced in 1999. Against the yen, the Australian dollar increased by 0.2 percent to trade at 82.22 yen; it increased by 0.2 percent against the dollar to trade at $1.0287. On the other hand, the New Zealand currency increased against the euro by 1.1 percent to settle at NZ$!.5422.
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