Forex - NZD/USD lower on New Zealand data, Cyprus vote

Published 03/20/2013, 03:52 AM
Updated 03/20/2013, 03:53 AM
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Investing.com - The New Zealand dollar was lower against its U.S. counterpart on Wednesday, after the release of disappointing current account data from New Zealand, while the rejection by Cyprus's parliament of a proposed bank deposit tax also weighed.

NZD/USD hit 0.8214 during late Asian trade, the pair's lowest since March 15; the pair subsequently consolidated at 0.8231, shedding 0.19%.

The pair was likely to find support at 0.8235, the low of March 14 and resistance at 0.8270, Tuesday's high.

In New Zealand, official data showed that the current account deficit narrowed less-than-expected in the fourth quarter, hitting NZD3.26 billion from a deficit of NZD4.39 billion in the previous quarter.

Analysts had expected the current account deficit to narrow to NZD2.97 billion in the last quarter.

Meanwhile, Cyprus’s President Nicos Anastasiades called an emergency meeting with political leaders to look at alternatives after parliament rejected the terms of the bailout agreement.

Following the vote, the European Central Bank said it will provide liquidity to Cypriot banks within existing rules.

German Finance Minister Wolfgang Schaeuble warned Cyprus that its banks might never be able to reopen if it rejected the bailout.

Sentiment found some support amid growing expectations that the European Union will renegotiate a deal with Cyprus to keep the country in the euro zone.

The kiwi was lower against the euro with EUR/NZD gaining 0.36%, to hit 1.5677.

Investors were looking ahead to the outcome of the Federal Reserve’s policy meeting later in the trading day, after data last week showing that U.S. inflation was contained left the way clear for the bank to continue its asset purchase program.


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