The Australian and New Zealand dollars rose against their U.S. counterpart on Monday, as investors locked in profits on the greenback’s recent rally due to heightened expectations for a June rate hike by the Federal Reserve.
AUD/USD rose 0.36% to 0.7249, off last week’s two-and-a-half month lows of 0.7172.
The dollar strengthened broadly after the Federal Reserve’s April meeting minutes on Wednesday indicated that interest rates could rise as soon as June.
Officials said a June rate hike would be appropriate if economic data indicated that growth was picking up in the second quarter and employment and inflation were firming.
In addition, New York Federal Reserve President William Dudley said on Thursday that the U.S. economy could be strong enough to warrant a rate hike in June or July.
NZD/USD advanced 0.74% to trade at 0.6805, pulling away from last week’s two-month trough of 0.6707.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.13% at 95.17, after hitting three-week highs of 95.51 on Friday.