Kiwi poised to test 12 month lows

Key Movers

The US Dollar rebounded through trade on Wednesday, bouncing off two weeks lows as an uptick in equities and repositioning of monetary policy expectations pulled the currency higher. Having touched two week lows on Tuesday the dollar index pushed back through 99 as equities recovered losses suffered across the worst four day sell off in over a year and the coronavirus continued its worrying spread across Europe, while the first case reported in Latin America was confirmed. Commentary from Fed Vice Chair Clarida also helped drive the dollar higher. Clarida confirmed, while the bank was monitoring the impacts of the coronavirus pandemic, it was still to early to suggest it will force a correction in the current monetary policy platform. The comments forced investors to reposition Fed rate expectations having priced in a higher chance of a rate cut earlier this week. The Great British Pound fell through trade on Wednesday adjusted expectations surrounding the upcoming March Budget and an anticipated uptick in fiscal spending. Having rallied strongly in the aftermath of Rishi Sunak’s appointment as finance minister investors are now correcting positions and taking profit as the likelihood of a watered-down stimulus package increases. Having slipped back below 1.30 Sterling touched 1.2904.