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Commodity Currencies Lower Before Fed

The currencies of commodity-exporting nations including Australia and New Zealand were near the lowest in at least four years as traders braced for a Federal Reserve statement that may indicate it is ready to raise interest rates.

The Australian dollar was less than one U.S. cent from its lowest since 2009, while New Zealand’s currency was weighed down by a disappointing dairy auction. The U.S. dollar snapped a two-day decline against the euro and rose against a basket of major peers. Fed Chair Janet Yellen and her colleagues end a two-day meeting Wednesday.

“Commodities are very much in the forefront of markets’ minds and commodity-linked currencies are definitely under pressure,” said Sam Tuck, a senior currency strategist at ANZ Bank New Zealand Ltd. in Auckland. “The majority in the market believes Yellen will remove patient” from the Fed’s pledge on interest-rate policy, he said.

Bloomberg [1]

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