Australian dollar surges as US Fed releases statement

THE Australian dollar has soared by more than one-and-a-half US cents after the US Federal Reserve signalled it would need to see an improvement in the jobs market.

THE Australian dollar has soared by more than one-and-a-half US cents after the US Federal Reserve signalled it would need to see an improvement in the jobs market before raising interest rates.

At 0630 AEDT on Thursday, the local currency was trading at 77.75 US cents, up from 76.06 cents on Wednesday.

The Australian dollar surged from 76.35 to a two-week high of 78.03 US cents, early on Thursday morning, after the Fed’s Federal Open Market Committee released a statement saying it would need to see an improvement in the jobs market before raising the federal funds rate.

It also said it would need to be confident that inflation would move back to its two per cent target “over the medium term”. The Fed removed the word “patience” from its statement regarding a possible rate increase but it downgraded its quarterly forecasts for growth.

The US dollar weakened against a range of currencies.

CURRENCY SNAPSHOT AT 0630 AEDT ON THURSDAY:

One Australian dollar buys:

* 77.75 US cents, from 76.06 cents on Wednesday

* 93.63 Japanese yen, from 92.32 yen

* 72.03 euro cents, from 71.88 euro cents

(*Closes taken at 1700 AEDT previous local session) Source: IRESS

Originally published as Australian dollar surges as US Fed releases statement