The Australian and New Zealand dollars moved higher against their U.S. counterpart on Tuesday, as Monday’s weak U.S. data weighed on the greenback, while upbeat New Zealand data and comments by the Reserve Bank of Australia boosted the two local currencies.
NZD/USD advanced 0.74% to 0.7190, the highest since October 7.
The greenback came under pressure after data on Monday showed that U.S. industrial production increased by 0.1% last month, below expectations for a gain of 0.2%.
Separately, the Federal Reserve of New York said its Empire State manufacturing index fell to -6.80 in October from -1.99 the previous month. Analysts had expected the index to rise to 1.00.
The U.S. dollar was also hit after Federal Reserve Vice Chairman Stanley Fischer said on Monday that economic stability could be threatened by low interest rates, but it was “not that simple” for the Fed to raise rates.
Earlier Tuesday, Statistics New Zealand said that the consumer price index rose 0.2% in the third quarter, beating expectations for a flat reading and after an increase of 0.4% in the three months to June.
AUD/USD climbed 0.66% to trade at 0.7679, the highest level since October 4.
Meanwhile, the Aussie found support after Reserve Bank of Australia Governor Philip Lowe said he was comfortable with the current exchange rate.
In his first speech as the RBA governor, Philip Lowe emphasised that current low levels of inflation were not unprecedented, dampening expectations for further rate cuts.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.16% at 97.70, off Monday’s seven-month high of 98.15.