The Australian dollar fell against the monetary units of the U.S. and New Zealand on Tuesday as speculation mounted that the central bank of Australia will need to deploy economic stimulus measures to prompt the nation's development and growth, according to Bloomberg.
Policy makers with the Reserve Bank of New Zealand are slated to convene on Thursday. The Sydney Morning Herald reports the Aussie's poor performance on Tuesday was curbed by the strong showing of the English pound.
"The main driver of the currency on Tuesday was a spike in the British pound sterling around 1:30 p.m., local time – a symptom of exaggerated price action due to a lack of liquidity during the Asian session," CityIndex currency analyst Kara Ordway with CityIndex told The Sydney Morning Herald on Tuesday. "The spike in the pound helped push up the relative value of other major cross-rates against the US dollar, including the Aussie dollar."
The Aussie slumped roughly 0.2 percent against the greenback and approached its lowest value in almost five years against the kiwi.
The Aussie's losses also were spurred by conjecture about when the U.S. Federal Reserve will implement tapering policies, The Sydney Morning Herald reports.
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