Investing.com - The Australian dollar edged higher against its U.S. counterpart on Thursday, while the New Zealand dollar lost ground as demand for the greenback remained broadly supported by expectations for a June rate hike by the Federal Reserve.
AUD/USD added 0.18% to 0.7210, pulling away from Tuesday’s nearly three-month low of 0.7146.
But gains were expected to remain limited as the Australian Bureau of Statistics said earlier Wednesday that private capital expenditure declined by 5.2% in the first quarter, compared to expectations for a 3.0% drop.
Private capital expenditure increased by 1.8% in the fourth quarter of 2015, whose figure was revised from a previously estimated 0.8% rise.
Meanwhile, the greenback remained supported by expectations that the Fed could raise interest rates in the near term after last week’s April Fed meeting minutes flagged a possible rate hike if the economy continues to improve.
NZD/USD slid 0.36% to trade at 0.6716, the lowest since March 28.
In its Annual Budget Release, the New Zealand government said on Thursday that its budget was positive and predicted ongoing surpluses.
However, New Zealand’s Treasury warned that a Brtish exit from the European Union – due to be determined by referendum on June 23 – could pose economic risks for the country if it affects key export sectors.
Other risks for the economy mentioned in the report included a slowdown in China, geopolitical tensions in the Middle East, terror attacks in Europe and uncertainty over low interest rates.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.23% at 95.18, still close to Wednesday’s two-month high of 95.66.