Forex - NZD/USD lower on E.Z. worries, eyes on RBNZ rate decision

Published 07/25/2012, 02:50 AM
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Investing.com - The New Zealand dollar fell to a more than one-month low against its U.S. counterpart on Wednesday, as euro zone debt concerns continued to weigh on sentiment while investors eyed the Reserve Bank of New Zealand’s rate decision later in the day.

NZD/USD hit 0.7809 during late Asian trade, the pair’s lowest since June 14; the pair subsequently consolidated at 0.7825, falling 0.26%.

The pair was likely to find support at 0.7756, the low of May 14 and resistance at 0.7878, the high of May 11.

Concerns over the handling of Spain’s financial woes persisted after the yield on Spanish 10-year government bonds spiked to 7.71% earlier, well above the 7% threshold widely considered unsustainable, fuelling fears that Madrid will lose access to international credit markets.

Meanwhile, officials from the European Union and the International Monetary Fund said Greece had little hope of meeting the terms of its bailout, casting fresh doubts over the country’s future in the euro zone.

The comments came after Prime Minister Antonis Samaras said Greece's economy could contract by more than 7% this year, pushing debt-cutting targets further out of reach.

In New Zealand, official data showed earlier that the trade surplus widened unexpectedly in June, rising to NZD331 million from a surplus of NZD232 million the previous month.

Analysts had expected the trade surplus to narrow to NZD77 million in June.

Elsewhere, the kiwi was lower against the euro with EUR/NZD rising 0.22%, to hit 1.5407.

Later in the day, the U.S. was to release official data on new home sales, as well as a report on crude oil stockpiles.

The RBNZ was to release its interest rate decision followed by a statement.


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