Investing.com - The New Zealand dollar edged higher against its U.S. counterpart on Tuesday, but gains were expected to remain limited as investors remained cautious ahead of the outcome of the Federal Reserve's policy meeting this week.
NZD/USD hit 0.8288 during late Asian trade, the pair's highest since December 12; the pair subsequently consolidated at 0.8270, adding 0.15%.
The pair was likely to find support at 0.8204, the low of December 13 and resistance at 0.8334, the high of December 10.
Investors remained cautious ahead of the outcome of the Fed’s two-day policy meeting on Wednesday, with some expecting the bank to announce a small reduction in the pace of its USD85 billion-a-month asset purchase program.
Markets were also eyeing U.S. inflation data due out later in the session amid concerns that the subdued inflation outlook could prompt the Fed to keep its stimulus program in place for longer.
The kiwi was higher against the Australian dollar, with AUD/NZD shedding 0.24% to 1.0808.
Also Tuesday, the minutes of the Reserve Bank of Australia's December policy meeting showed that the bank maintained the option of loosening monetary policy further due to an “uncomfortably high” currency.
The report added that "given the substantial degree of policy stimulus that had been imparted, it was prudent to hold the cash rate steady."
Separately, in the Treasury's Mid-Year Economic and Fiscal Outlook, Treasurer Joe Hockey pledged spending cuts after saying Australia’s budget deficit will expand to AUD47 billion this fiscal year.
He added that growth is expected to be 2.5% this fiscal year, unchanged from the Treasury’s forecast ahead of the September 7 election.
Official data showed that new motor vehicle sales in Australia rose 1.8% in November, after a downwardly revised 0.9% decline the previous month.
In addition, the Conference Board said its leading index for Australia rose 0.5% in October, after a 0.3% gain in September.
NZD/USD hit 0.8288 during late Asian trade, the pair's highest since December 12; the pair subsequently consolidated at 0.8270, adding 0.15%.
The pair was likely to find support at 0.8204, the low of December 13 and resistance at 0.8334, the high of December 10.
Investors remained cautious ahead of the outcome of the Fed’s two-day policy meeting on Wednesday, with some expecting the bank to announce a small reduction in the pace of its USD85 billion-a-month asset purchase program.
Markets were also eyeing U.S. inflation data due out later in the session amid concerns that the subdued inflation outlook could prompt the Fed to keep its stimulus program in place for longer.
The kiwi was higher against the Australian dollar, with AUD/NZD shedding 0.24% to 1.0808.
Also Tuesday, the minutes of the Reserve Bank of Australia's December policy meeting showed that the bank maintained the option of loosening monetary policy further due to an “uncomfortably high” currency.
The report added that "given the substantial degree of policy stimulus that had been imparted, it was prudent to hold the cash rate steady."
Separately, in the Treasury's Mid-Year Economic and Fiscal Outlook, Treasurer Joe Hockey pledged spending cuts after saying Australia’s budget deficit will expand to AUD47 billion this fiscal year.
He added that growth is expected to be 2.5% this fiscal year, unchanged from the Treasury’s forecast ahead of the September 7 election.
Official data showed that new motor vehicle sales in Australia rose 1.8% in November, after a downwardly revised 0.9% decline the previous month.
In addition, the Conference Board said its leading index for Australia rose 0.5% in October, after a 0.3% gain in September.