The dollar was on the back foot on Thursday, with trade thinned ahead of the U.S. Thanksgiving holiday. <\/p>\n
Javier Ghersi | Moment | Getty Images<\/p>\n
The dollar was on the back foot on Thursday, with trade thinned ahead of the U.S. Thanksgiving holiday and investors turning to the coming year where a series of U.S. interest rate cuts are priced in.<\/p>\n
The yen<\/a>\u00a0drifted 0.4% higher to 155.87 per dollar and the euro<\/a>\u00a0clambered above $1.16 in morning trade.<\/p>\n A resurgent New Zealand dollar<\/a>\u00a0skipped out to a three-week peak of $0.5714 following a hawkish shift at the central bank and strong economic data.<\/p>\n The Reserve Bank of New Zealand cut rates on Wednesday but said that a hold was discussed and flagged that the easing cycle was likely over, with markets shifting to price in an interest rate hike by December next year.<\/p>\n That contrasts with more than 90 basis points of cuts priced for the U.S. Federal Reserve<\/a> between now and the end of 2026.<\/p>\n Data showed New Zealand retail sales rose in the third quarter, while business confidence jumped to its highest in a year.<\/p>\n “Kiwi green shoots are really starting to mushroom quite quickly now,” said Westpac strategist Imre Speizer.<\/p>\n The Australian dollar<\/a>\u00a0has also been gaining after a hotter-than-expected inflation reading on Wednesday added to the case that the easing cycle there is also finished.<\/p>\n Australia’s 10-year rate<\/a>\u00a0of 4.48% is the highest in the G10, which analysts point out makes the currency look cheap.<\/p>\n At $0.6526 the Aussie is in the middle of a channel where it has traded for about 18 months. Kit Juckes at Societe Generale, however, notes it has more closely tracked China’s yuan than interest rates lately – which could support further gains as the yuan has climbed sharply in recent sessions.<\/p>\n Pushback from China’s central bank fixing mechanism steadied the yuan<\/a>\u00a0at the open on Thursday.<\/p>\n