14 Sep 2012

NZ dollar jumps as US central bank starts spending

7:24 pm on 14 September 2012

The New Zealand dollar reached a six-and-a-half month high after news that the US Federal Reserve has launched an open-ended stimulus package.

The US's central bank has announced a new round of bond-buying known as quantitative easing and it will keep interest rates lower for longer.

Under the bond-buying plan it will buy $40 billion dollars of mortgage-backed debt per month until the outlook for jobs improves substantially.

The exchange rate for the NZ dollar jumped around one US cent from 82.20 US cents to 83.20 US cents after the announcement.