SYDNEY: The Australian and New Zealand dollars found themselves on firmer ground on Thursday as dovish comments from the world’s most powerful central banker pulled down Treasury yields and put the squeeze on short positions.
Both currencies had been under pressure until Federal Reserve Chair Jerome Powell reassured markets that US rates would still likely fall this year, quashing talk that a recent blip in inflation might derail an easing.
The comments dragged down US yields and the dollar and triggered a wave of stop-loss buying in the Aussie when resistance at $0.6535 cracked.
That left the Aussie at $0.6571, having rallied 0.9% in the New York session. The bounce rescued it from a three-week low of $0.6477 and set up a possible tilt at resistance around $0.6595.
The kiwi followed suit to $0.6133, having jumped 0.7% overnight and away from a low of $0.6070. Resistance now lies around $0.6176.
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