Forex - NZD/USD higher amid new hopes for Greece, Spain

Published 12/04/2012, 02:57 AM
Updated 12/04/2012, 02:59 AM
NZD/USD
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AUD/NZD
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Investing.com - The New Zealand dollar was higher against its U.S. counterpart on Tuesday, as new hopes of progress in tackling Greece and Spain's financial woes supported demand for risk-related assets.

NZD/USD hit 0.8234 during European morning trade, the pair's highest since November 30; the pair subsequently consolidated at 0.8225, adding 0.19%.

The pair was likely to find support at 0.8202, the session low and resistance at 0.8268, the high of November 29.

Sentiment was boosted after Greece on Monday launched a scheme to buy back its debt from private investors, as part of an agreement to unlock a new bailout package worth EUR44 billion.

In addition, Spanish bond yields turned lower after Madrid formally requested a bailout to recapitalize its banking sector.

Meanwhile, investors continued to watch negotiations between Democrats and Republicans to avoid the U.S. fiscal cliff, a set of spending cuts and tax increases due to come into effect on January 1 if lawmakers cannot reach an agreement on reducing the budget deficit.

The kiwi was steady against the Australian dollar with AUD/NZD inching down 0.01%, to hit 1.2690.

Also Tuesday, the Reserve Bank of Australia cut its benchmark interest rate to 3% from 3.25%, a 50-year low set during the 2009 global recession, as hiring slows and a strong currency hurts industries such as manufacturing and tourism.

The announcement came after official data showed that building approvals in Australia dropped far more-than-expected in October, declining by 7.6% after a 9.5% rise the previous month.

Analysts had expected building approvals to fall 2% in October.



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