Aussie, Kiwi benefit from Japanese stimulus announcement

Posted On: September 19, 2012
South Pacific monetary units climbed in value on Wednesday against the Japanese yen after the central bank of the Pacific Rim nation increased the scope of its stimulus measure, according to Bloomberg.

Demand for higher-yielding assets grew after the Bank of Japan said Wednesday morning it was boosting its fund that purchases assets by the equivalent of $126 billion. But the Australian dollar's climb was limited in anticipation of the Thursday release of the purchasing managers' index in Europe.

Action by the BOJ "is a broad positive for risk appetite, including the Aussie and kiwi," head of Asia local markets strategy Thomas Harr with Standard Chartered in Singapore told the news source. "The bias over the coming months is definitely higher."

The Kiwi gained in value after the country's statistics bureau indicated New Zealand's current-account shortfall was 4.9 percent of the gross domestic product for year ended June 30. That figure was 4.5 percent in the one-year period that led to March.

Gains to the Aussie come after the monetary unit benefited from the U.S. Federal Reserve last week announcing a third round of quantitative easing, The Wall Street Journal reports.

Category: Industry News

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