Australian GDP extends kiwi decline



THE New Zealand dollar has extended its decline against the Australian dollar after faster-than-expected second-quarter growth in Australia dulled its expectations of further interest rates cuts.


The kiwi fell to 85.81 Australian cents at 5pm in Wellington from 86.11 cents immediately before the gross domestic product figures were released, and down from 86.63 cents on Tuesday.

The NZ currency traded at 78.10 US cents at 5pm from 77.90 cents at 8am, down from 78.27 cents on Tuesday.

Australia’s economy grew 0.6 per cent in the three months ended June 30, according to the Bureau of Statistics, just ahead of the 0.5 per cent pace predicted in a Bloomberg survey of economists.

The release came a day after the Reserve Bank of Australia kept rates on hold at 2.5 per cent, while removing a reference to having scope to cut rates.

The RBA statement showed “they didn’t have their finger on the trigger to pull another rate cut any time soon, and today’s GDP reinforced that,” said Michael Johnston, senior trader at HiFX in Auckland.

“We may have a little further to run on the kiwi/Aussie to the downside, but that should be a good opportunity for exporters to jump in.”

The NZ dollar increased to 77.85 yen at 5pm in Wellington from 77.76 yen on Tuesday and was unchanged at 59.32 euro cents.

The trade-weighted index decreased to 74 from 74.21.

Source Article from http://news.com.au.feedsportal.com/c/34564/f/632570/s/30c29fda/sc/2/l/0L0Snews0N0Bau0Cbusiness0Cbreaking0Enews0Cnz0Edollar0Eslides0Eagainst0Eaussie0Cstory0Ee6frfkur0E1226710A2146420Dfrom0Fpublic0Irss/story01.htm

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