Investing.com - The Australian dollar gained on Wednesday after remarks by Reserve Bank of Australia Governor Glenn Stevens to parliament that borrowing costs are not "per se" holding back economic growth, but adding that the cash rate would be lowered if needed to support the economy.
AUD/USD traded at 0.8922, up 0.25%, after the comemnts.
"The board has maintained an open mind about whether we may need to lower interest rates further. At this point, however, there are few serious claims that the cost of borrowing per se is holding back growth," Stevens said.
"On the contrary, monetary policy is supporting higher spending by altering incentives as between spending and saving, and working to create an environment in asset and credit markets that eases the restraints on some sorts of activity."
NZD/USD traded at 0.8262, up 0.10%, despite a wider than expected third quarter current account bdeficit of NZD4.78 billion, compared to an estimate of NZD4.30 billion.
USD/JPY traded at 102.84, up 0.16%, despite Japense November exports up a better than expected 18.4%, compared to an estimnate of 17.9%.
Overnight the dollar traded flat to lower against most major currencies as investors spent the session digesting not-too-hot, not-too-cold U.S. inflation data ahead of the Federal Reserve's Wednesday statement on monetary policy and the fate of its USD85 billion in monthly bond purchases.
The Department of Labor reported earlier that the U.S. consumer price index came in flat in November after falling 0.1% in October. Analysts were calling for a 0.1% uptick.
The annual rate of inflation rose 1.2% in November, just shy of expectations for 1.3% reading but still up from a four-year low of 1.0% in October.
U.S. core inflation, stripped of volatile food and energy items, rose 0.2% in November from October, beating expectations for a 0.1% gain, while the year-on-year rate for November rose 1.7%, which met consensus forecasts.
Meanwhile in Europe, the ZEW index of German economic sentiment rose to 62.0 in December from 54.6 in November. It was the highest level since April 2006. Economists were predicting the index to tick up to 55.0 this month.
Also in Europe, Eurostat, the statistical arm of the European Union, reported that the euro area's monthly November CPI contracted 0.1% but rose 0.9% on year, both figures matching market forecast.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was flat at 80.21.
On Wednesday, the dollar will move on the Fed's statement on U.S. monetary policy. Elsewhere, the U.S. is to release data on building permits and housing starts.
AUD/USD traded at 0.8922, up 0.25%, after the comemnts.
"The board has maintained an open mind about whether we may need to lower interest rates further. At this point, however, there are few serious claims that the cost of borrowing per se is holding back growth," Stevens said.
"On the contrary, monetary policy is supporting higher spending by altering incentives as between spending and saving, and working to create an environment in asset and credit markets that eases the restraints on some sorts of activity."
NZD/USD traded at 0.8262, up 0.10%, despite a wider than expected third quarter current account bdeficit of NZD4.78 billion, compared to an estimate of NZD4.30 billion.
USD/JPY traded at 102.84, up 0.16%, despite Japense November exports up a better than expected 18.4%, compared to an estimnate of 17.9%.
Overnight the dollar traded flat to lower against most major currencies as investors spent the session digesting not-too-hot, not-too-cold U.S. inflation data ahead of the Federal Reserve's Wednesday statement on monetary policy and the fate of its USD85 billion in monthly bond purchases.
The Department of Labor reported earlier that the U.S. consumer price index came in flat in November after falling 0.1% in October. Analysts were calling for a 0.1% uptick.
The annual rate of inflation rose 1.2% in November, just shy of expectations for 1.3% reading but still up from a four-year low of 1.0% in October.
U.S. core inflation, stripped of volatile food and energy items, rose 0.2% in November from October, beating expectations for a 0.1% gain, while the year-on-year rate for November rose 1.7%, which met consensus forecasts.
Meanwhile in Europe, the ZEW index of German economic sentiment rose to 62.0 in December from 54.6 in November. It was the highest level since April 2006. Economists were predicting the index to tick up to 55.0 this month.
Also in Europe, Eurostat, the statistical arm of the European Union, reported that the euro area's monthly November CPI contracted 0.1% but rose 0.9% on year, both figures matching market forecast.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was flat at 80.21.
On Wednesday, the dollar will move on the Fed's statement on U.S. monetary policy. Elsewhere, the U.S. is to release data on building permits and housing starts.