Kiwi to 26-month high as greenback weakens

The kiwi dollar pushed to a fresh 26-month high on Thursday against the greenback as the US dollar remained out of favour in Asian trading.

The kiwi traded at US75.45c at 5pm from US75.12c at 8am and 73.38c lateWednesday. It touched 75.58 the highest since May 2015 when it traded at 75.64.

The US dollar remained under pressure after the US Federal Reserve’s Open Market Committee statement said both overall inflation and the measure excluding food and energy prices have declined and are running below 2 per cent.

But it removed the word “recently”, suggesting it may no longer view the decline as temporary.

It did say, however, it “expects to begin implementing its balance sheet normalization program relatively soon” and because of that investors “may be getting ahead of themselves with the USD sell-off, said Sheldon Slabbert, a trader at CMC Markets.

“I think the markets are potentially underestimating the impact of lower liquidity,” he said. “That will have a far greater impact going forw…

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