Fed minutes ruffle investors

THE Australian dollar is sharply higher against its US counterpart, breaching above 75 US cents after the Federal Reserve’s minutes ruffled investors.

THE Australian dollar is sharply higher against its US counterpart, breaching above 75 US cents after the Federal Reserve’s minutes ruffles investor sentiment and the greenback.

At 0635 AEST on Thursday, the Australian dollar was worth 75.03 US cents, up from 74.59 US cents on Wednesday.

Westpac’s Imre Speizer said the local currency got a lift from a weaker US dollar after the minutes of the Federal Open Markets Committee’s last policy meeting were released indicating the central bank’s latest position on interest rates.

“The FOMC minutes were consistent with another hike in June but conditional on recent economic softness proving transitory. That caveat ruffled markets, the US dollar and interest rates lower,” he said in a morning note. “The US dollar index (was) 0.2 per cent lower on the day ... AUD rose from 0.7455 to 0.7496.”

He thought the Aussie dollar could lift further on Thursday and Friday. “There’s potential for a retest of this week’s 0.7517 peak, given the US dollar remains on the back foot.” The Aussie dollar is also higher against the yen and the euro.

CURRENCY SNAPSHOT AT 0635 AEST ON THURSDAY

One Australian dollar buys:

* 75.03 US cents, from 74.59 on Wednesday

* 83.71 Japanese yen, from 83.46 yen

* 66.90 euro cents, from 66.73 euro cents

(*Currency closes taken at 1700 AEST previous local session)

Originally published as Fed minutes ruffle investors