Investing.com - The Australian dollar edged higher against its U.S. counterpart on Thursday, as demand for the greenback weakened after the Federal Reserve indicated that interest rates will remain low for a considerable time after the bank’s asset purchase program ends.
AUD/USD hit 0.9419 during late Asian trade, the pair''s highest since June 13; the pair subsequently consolidated at 0.9423, adding 0.19%.
The pair was likely to find support at 0.9323, Wednesday''s low and resistance at 0.9461, the high of April 10.
At the conclusion of its two-day meeting on Wednesday, the Fed cut its bond purchases by another $10 billion a month, to $35 billion, saying there was "sufficient underlying strength" in the U.S. economy to continue tapering.
Despite this, the Fed also lowered its forecast for growth this year to a range of 2.1% to 2.3% from 2.8 to 3.0% previously, due to "unexpected contractions" in the first quarter as a result of the unusually harsh winter. The central bank still acknowledged a broad improvement in the labor market.
The Fed said it expects the federal-funds rate, currently close to zero, to reach 1.2% by the end of next year and 2.5% by the end of 2016, a slightly faster rate of tightening than formerly expected.
The Aussie was higher against the New Zealand dollar, with AUD/NZD rising 0.26% to 1.0799.
Also Thursday, official data showed that New Zealand''s gross domestic product rose by 1% in the first quarter, compared to expectations for an expansion of 1.2%. For the fourth quarter of 2013, New Zealand''s GDP was revised up to an expansion of 1% from a previously estimated growth rate of 0.9%.
Later in the day, the U.S. was to publish the weekly report on initial jobless claims as well as a report on manufacturing activity in the Philadelphia region.