Dollar Reaches Two-Week High as Asian Currencies Weaken

The US dollar reached a two-week high in European trading on Wednesday, causing many Asian currencies to weaken. The euro and pound fell as rising oil prices and global bond yields kept inflation concerns elevated.

The New Zealand dollar's pair rose 0.9% to 0.5843, putting it at its lowest since August 13 after the Reserve Bank of New Zealand raised its policy rate by 25 basis points and delivered a less-hawkish policy outlook.

ANZ analysts said the policy track did not point to another increase in October and that the language around future decisions was deliberately vague and highly conditional. This led to wholesale rates and the NZD moving lower, with an October hike now seen as less likely.