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Forex - NZD/USD soars to 27-month high after RBA rate bump

Published 11/02/2010, 10:11 AM
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EUR/NZD
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Investing.com – New Zealand’s was up against its U.S. counterpart on Tuesday, soaring to a 27-month high, after Australia’s central bank unexpectedly raised its interest rate for the first time in six months.

NZD/USD hit 0.7742 during European afternoon trade, the pair’s highest since July 15, 2008; the pair subsequently consolidated at 0.724, surging 0.69%.

The pair was likely to find support at 0.7633, Monday’s low and resistance at 0.7801, the high of June 6, 2008.

Earlier in the day, the Reserve Bank of Australia unexpectedly raised its Official Cash Rate by a quarter of a percentage point to 4.75% amid concern that stronger growth will cause inflation to accelerate.

Also Tuesday, official data showed that New Zealand wage growth accelerated for the second successive quarter.

In a report, Statistics New Zealand said wages for non-governmental workers, excluding overtime, advanced 0.6% in the third quarter from the second quarter. Annual growth rose to 1.6% from 1.4% in the year through June.

Meanwhile, the kiwi was down against the euro, with EUR/NZD gaining 0.34% to hit 1.8166.

Later in the day, Federal Reserve policy makers were to begin their 2-day November policy meeting, which was widely expected to result in the unveiling of fresh monetary easing. Also Tuesday, U.S. mid-term elections were due to be held.

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