US dollar weakens after Fed holds rates, Canadian dollar rises on rate hike
The US dollar weakened against major currencies after the Federal Reserve kept rates unchanged. The Canadian dollar rose nearly 0.4 per cent after the Bank of Canada raised rates for the first time in over three years. The New Zealand dollar fell after its central bank unexpectedly held rates.
The US dollar weakened against major currencies on 28 October, with the US dollar index falling more than 0.2 per cent to 102.11. The Federal Reserve kept its benchmark interest rate unchanged, a decision that was in line with market expectations. Interest rate futures indicated that traders see an almost 85 per cent chance of a rate increase in December, according to reports.
The Bank of Canada raised its key interest rate for the first time in more than three years, and signalled that further increases may be needed. The Canadian dollar rose nearly 0.4 per cent against the US dollar to 1.40 Canadian dollars per US dollar.
The New Zealand dollar fell sharply after the Reserve Bank of New Zealand unexpectedly held its official cash rate steady, defying market forecasts. The kiwi fell more than 1.7 per cent at one point to 0.5583 US dollars before recovering slightly to 0.5629 US dollars.
The euro rose 0.32 per cent against the US dollar to 1.116 US dollars. The British pound gained 0.12 per cent to 1.3323 US dollars. The US dollar was little changed against the Japanese yen, trading at 157.87 yen.