The Australian dollar touched an almost three-week high as demand for riskier assets rose amid speculation the Federal Reserve will implement a third round of quantitative easing, or QE, at a meeting that begins today.
Australiaâ€™s currency gained against most major counterparts as Germanyâ€™s constitutional court is set to decide on the countryâ€™s participation in Europeâ€™s bailout fund. The so-called Aussie and New Zealandâ€™s dollar strengthened versus the greenback yesterday after Moodyâ€™s Investors Service said the U.S.â€™s Aaa rating may be cut. A private report today showed an improvement in Australian consumer confidence.
â€œIf the Fed decides to conduct QE3 as the markets expect, itâ€™s likely to lead to a risk-on sentiment,â€ Junichi Ishikawa, a Tokyo-based analyst at IG Markets Securities Ltd. said. â€œThe Aussie and kiwi are supported on the back of the U.S. dollarâ€™s broad weakness.â€
via Bloomberg 
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