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Forex - NZD/USD higher as market sentiment improves

Published 08/20/2012, 02:49 AM
NZD/USD
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AUD/NZD
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Investing.com - The New Zealand dollar advanced against its U.S. counterpart on Monday, as new hopes for progress in handling the euro zone’s debt woes lifted market sentiment, while investors eyed the minutes of the Federal Reserve’s latest policy meeting later in the week.

NZD/USD hit 0.8096 during late Asian trade, the daily high; the pair subsequently consolidated at 0.8088, adding 0.16%.

The pair was likely to find support at 0.8036, the low of August 15 and resistance at 0.8138, the high of August 10.

Sentiment improved ahead of a series of euro zone meetings this week to discuss measures to stem the region’s debt crisis.

Luxemburg Prime Minister Jean-Claude Juncker, who also heads the group of euro zone finance ministers, is expected in Athens on Wednesday to discuss Greek Prime Minister Antonis Samaras’ request for a two-year extension for the country’s fiscal adjustment program.

Samaras is expected in Berlin and Paris at the end of the week, after French President Francois Hollande and German Chancellor Angela Merkel meet in the German capital on Thursday.

Investor confidence had briefly strengthened last week after German Chancellor Angela Merkel backed European Central Bank President Mario Draghi's vow to do all that is necessary to defend euro.

Her comments increased expectations the ECB would buy Spanish and Italian bonds next month to lower the two countries' borrowing costs.

German magazine Spiegel reported on Sunday that the ECB may set limits on yields of euro-area sovereign debt by pledging unlimited bond purchases, at the bank’s next policy meeting in September.

The kiwi was steady against the Australian dollar with AUD/NZD inching up 0.06%, to hit 1.2915.

Separately, markets were eyeing the minutes of the Fed’s most recent policy meeting, expected on Wednesday, after a string of positive reports last week dampened expectations for fresh stimulus measures by the U.S. central bank.


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