Kiwi Slides Amid New Zealand’s Q4 Inflation Report
Wednesday morning in Asia, the New Zealand dollar slid against its major counterparts following the Statistics NZ report showed that the Consumers Price Index for the quarter ending in December 2009 was down 0.2 percent from the previous quarter. The New Zealand dollar slumped to multi-day lows against the Australian and US dollars.
For the full 2009 year, the CPI was higher by 2.0 percent. Statistics NZ also said food prices fell 2.4 percent in the fourth quarter, down sharply from their winter peak.
The NZ dollar slumped to a 12-day low of 0.7325 against the US dollar by 6:05 pm ET, compared to 0.7356 hit late New York Tuesday. The kiwi-buck pair moved sideways thereafter and is currently worth 0.733 with 0.729 seen as the next downside target level.
Against its Australian counterpart, the New Zealand currency reached a 9-day low of 1.2606 at this time and descending below the 1.261 support may bring the domestic unit down to its lowest level in more than 5 weeks. The aussie-kiwi pair is presently quoted at 1.259, compared to yesterday’s close of 1.2566.
Latest economic data from Australia showed that the Westpac-Melbourne Institute index of consumer sentiment increased by 5.6 percent to 120.1 points in January, from 113.8 in December.
The NZ dollar declined to 66.76 against the Japanese yen before leveling off around 6:10 pm ET. The kiwi-yen pair, which finished Tuesday’s trading lower at 67.05, is presently quoted at 66.94 with 66.0 seen as the next target level.
Looking ahead, Japan will provide its final figures of machine tool orders at 1:00 am ET. At 2:00 am, the convenience store sales for December is due out.
The New Zealand dollar reached 1.9517 against the euro around 6:05 pm ET, down 1 percent from yesterday’s fresh 21-month high of 1.9319. The euro-aussie pair that was worth 1.9443 at Tuesday’s close is currently quoted at 1.9478 with 1.96 seen as the next likely support level.
Turning to the euro-area, the German producer prices for December and the Italian industrial orders for November may influence markets in the upcoming European session.
Across the Atlantic, the US producer price, housing starts and building permits data -all for the month of December are expected in the New York session today.
