Investing.com - The Australian dollar edged higher against its U.S. counterpart on Tuesday, while the New Zealand dollar slipped lower as demand for the greenback remained broadly supported by ongoing optimism over the outlook for the U.S. economy.
AUD/USD eased up 0.08% to 0.7375.
The greenback has remained supported amid expectations that President-elect Donald Trump’s plans to ramp up fiscal spending and cut taxes will spur economic growth and inflation.
Faster growth would spark inflation, which in turn would prompt the Fed to tighten monetary policy a faster rate than had previously been expected.
The U.S. dollar has also been boosted by bets that the U.S. central bank will almost certainly raise interest rates next month.
Fed Chair Janet Yellen on Thursday reiterated that a rate hike “could well become appropriate relatively soon.”
NZD/USD edged down 0.10% to trade at 0.7058.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.11% at 101.05, just off Friday’s 14-year peak of 101.54.