The New Zealand dollar retreated today as traders were afraid that tomorrow’s reports would show that manufacturing has slowed in China and the eurozone. Decline of manufacturing means falling demand for New Zealand’s exports and, as a result, currency.
PMI data for Europe and China will be tomorrow and economists are worried that it would show slowdown of manufacturing. The Federal Reserve will release the minutes of its last policy meeting today and investors fear that QE3 would not be mentioned in the minutes. All in all, Forex traders feel less themselves less certain now, but full-blown risk aversion did not come to the market yet.
The Standard & Poor’s 500 Index of stocks dropped 0.4 percent. The MSCI Asia Pacific Index declined 0.2 percent. The fall of shares gave another evidence that risk appetite is weakening.
NZD/USD was down from 0.8108 to 0.8083 and NZD/JPY fell from 64.26 to 64.02 as of 2:36 GMT today. Meanwhile, EUR/NZD edged up from 1.5365 to 1.5406.
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