Investing.com - The New Zealand dollar tumbled against its U.S. rival during Thursday’s Asian session following the release of HSBC flash reading of China’s May Purchasing Managers' Index.
In Asian trading Thursday, NZD/USD fell 0.40% to 0.8045. That took the pair below support at 0.8081, the low of May 20. NZD/USD now faces resistance at 0.8213, Tuesday's high.
On Thursday, China’s Purchasing Managers' Index for May fell to 49.6. HSBC’s April PMI reading was 50.4. Readings below 50 indicate contraction and the May flash reading is the first time since October that China has slipped below the 50 level.
The new orders index fell to 49.5, the worst reading since last September. China’s official PMI data will be released next week. Following a tepid batch of Chinese economic data points last month, some analysts pared their 2013 GDP growth forecasts for the world’s second-largest economy to 7.5% from 8%.
Market participants will be looking to see if similar actions occur should May data points show weakness compared to April.
The kiwi was already under pressure against the greenback after Federal Reserve Chairman Bernanke said the Fed’s USD85 billion per month bond-buying program, also known as the third version of quantitative easing, will stay in place for now. That is what financial markets wanted to hear, but the Fed chairman threw a curve ball by saying QE could taper off if conditions in the world’s largest economy improve.
In prepared testimony in Congress earlier, Bernanke said ultra-loose monetary policy was providing "significant benefits" to the economic recovery and reiterated that the bank’s asset-purchasing program will remain in place for now.
Elsewhere, NZD/JPY fell 0.54% to 82.88 while AUD/NZD inched down 0.07% to 1.2003. China is the largest trading partner for both Australia and New Zealand.
In Asian trading Thursday, NZD/USD fell 0.40% to 0.8045. That took the pair below support at 0.8081, the low of May 20. NZD/USD now faces resistance at 0.8213, Tuesday's high.
On Thursday, China’s Purchasing Managers' Index for May fell to 49.6. HSBC’s April PMI reading was 50.4. Readings below 50 indicate contraction and the May flash reading is the first time since October that China has slipped below the 50 level.
The new orders index fell to 49.5, the worst reading since last September. China’s official PMI data will be released next week. Following a tepid batch of Chinese economic data points last month, some analysts pared their 2013 GDP growth forecasts for the world’s second-largest economy to 7.5% from 8%.
Market participants will be looking to see if similar actions occur should May data points show weakness compared to April.
The kiwi was already under pressure against the greenback after Federal Reserve Chairman Bernanke said the Fed’s USD85 billion per month bond-buying program, also known as the third version of quantitative easing, will stay in place for now. That is what financial markets wanted to hear, but the Fed chairman threw a curve ball by saying QE could taper off if conditions in the world’s largest economy improve.
In prepared testimony in Congress earlier, Bernanke said ultra-loose monetary policy was providing "significant benefits" to the economic recovery and reiterated that the bank’s asset-purchasing program will remain in place for now.
Elsewhere, NZD/JPY fell 0.54% to 82.88 while AUD/NZD inched down 0.07% to 1.2003. China is the largest trading partner for both Australia and New Zealand.