By Sarah Turner, MarketWatch
SYDNEY (MarketWatch) — The U.S. dollar gained broadly on Wednesday, with the currency making particularly strong progress against the New Zealand dollar.
The dollar index (DXY 76.79, -0.26, -0.33%) , which measures the U.S. currency against six other currencies, traded at 77.120 on Wednesday, up from 77.049 in late North American trading on Tuesday.
Among the major currencies, the euro (EURUSD 1.3834, +0.0058, +0.4211%) declined to $1.3755, down from $1.3777 in late North American action. See real-time currency quotes and tools.
The British pound (GBPUSD 1.6307, +0.0046, +0.2829%) traded at $1.6232 against the dollar, down from $1.6260 late Tuesday.
The dollar bought 81.89 Japanese yen (USDYEN 81.9000, +0.0900, +0.1100%) , compared with ¥81.93 late Tuesday.
The dollar found some support on Tuesday as surging oil prices weighed on equity markets amid ongoing tension in North Africa and the Middle East.
Crude oil futures continued on an upward trajectory on Wednesday, topping the $100 barrel mark in electronic trading. Read more on oil
The New Zealand dollar (NZDUSD 0.7427, -0.0047, -0.6290%) fell 1% to 74.02 U.S. cents on after Prime Minister John Key said that he expects the Reserve Bank of New Zealand will probably cut interest rates as the country attempts to recover from two major earthquakes in less than six months, according to reports.
“The Reserve Bank of New Zealand has a difficult decision to make next week as it is, and it is not particularly helpful for the Prime Minister to add to the pressure for the bank to lower the cash rate,” commented exchange rate strategists at TD Securities.
More evacuees depart Libya
As more evacuees depart Libya government officials remain defiant about civilian causalities. Video courtesy of Reuters.
The strategists said that there currently isn’t a consensus between economists and the markets ahead of next week’s meeting.
“The dilemma is due to the perception that the RBNZ is expected to counter the negative fallout from last week’s fatal and destructive Christchurch earthquake, but the bank has been voicing a tightening bias for monetary policy for months now,” they said. The Reserve Bank of New Zealand will announce its next decision on interest rates on Mar. 10.
The Australian dollar (AUDUSD 1.0142, +0.0008, +0.0789%) also weakened against the greenback, trading down 0.4% at U.S. $1.0104.
The Australian economy expanded in the final quarter of 2010, data from the Australian Bureau of Statistics showed Wednesday, picking up steam from the third quarter but not growing as much as economists had expected. Read more on Australian GDP.
