Aussie leads recovery as hopes for accommodative Fed knock the dollar

Aussie leads recovery as hopes for accommodative Fed knock the dollar

18 Mar 2019 05:00 PM
 

The Australian dollar hit a two-week high and led a recovery against the U.S. currency on Monday as caution about the U.S. economy and expectations for an accommodative Federal Reserve meeting this week kept the greenback on the back foot.

The euro was also a beneficiary from the weaker dollar, adding 0.2% to $1.1355 as broader markets started the week in a bullish mood, with investors bidding equities higher.

Markets are expecting the Fed to strike a dovish tone when it meets this week, and bets for an interest rate cut have risen after weaker-than-expected manufacturing data on Friday. U.S. bond yields fell to 10-week lows.

The U.S. currency, measured against a basket of rivals, fell 0.1% to 96.39, hovering just above a two-week low. The Aussie was the biggest gainer from the greenback's pullback. The Australian currency added as much as 0.5 percent to $0.7119, a two-week high, before settling at $0.7104.

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