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Forex - NZD/USD higher ahead of euro zone meetings

Published 08/21/2012, 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 market sentiment remained supported by hopes of progress in tackling the debt crisis in the euro zone, ahead of a series of meetings this week.

NZD/USD hit 0.8118 during late Asian trade, the pair’s highest since August 17; the pair subsequently consolidated at 0.8119, rising 0.40%.

The pair was likely to find support at 0.8042, the low of August 14 and resistance at 0.8159, the high of August 9.

The kiwi remained supported ahead of Luxembourg Prime Minister Jean-Claude Juncker’s visit to Greece on Wednesday, to discuss the country’s request for an extension to its fiscal adjustment program.

German Chancellor Angela Merkel is to meet with French President Francois Hollande on Thursday, while Antonis Samaras is to meet with the French and German leaders later in the week.

On Monday, the European Central Bank dismissed reports that reports that it may set a cap on peripheral euro zone bond yields, saying it was "absolutely misleading" to report on decisions that have not yet been taken.

Elsewhere, the Reserve Bank of New Zealand said earlier that inflation expectations for the third quarter fell to their lowest in three years, ticking down to 2.3% from 2.4%.

The kiwi was fractionally lower against the Australian dollar with AUD/NZD adding 0.09%, to hit 1.2925.

Also Tuesday, the minutes of the Reserve Bank of Australia’s August policy meeting showed that the bank made no mention of a potential rate cut, seeing as domestic economic growth is overshadowing the “fragile” global outlook.

The RBA also said that inflation data was in line with expectations, although uncertainty coming from overseas is affecting consumer sentiment.

Trade looked likely to remain subdued on Tuesday, with no significant economic data releases on the calendar, while volumes were light with many market participants on summer holidays.


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