The kiwi had its worst week in a two-month period against the yen as slumping growth in China indicates that the recession is far from its ending.
Several factors made the N.Z. dollar to fall this week against major pairs, but the main event that brought the kiwi down was the Chinese economy, which is facing the slowest growth in 9 years. The New Zealand economy is highly dependent on its agricultural commodity exports, and having China as one of its main business partners make its continuous weak economic reports to cause a significantly negative impact on the country’s economy.
Economists affirm that despite the good numbers on the start of the week coming from the U.S. economy, the Chinese GDP, which failed to recover, made the kiwi unable to continue its rally. The Australian dollar is facing a similar situation and after a very intense rise during the past two months, the traders are taking the profit, considering also that the next week will be marked by important U.S. earning reports, which can lead the market towards uncertain directions.
The NZD/USD was traded at 0.5714, falling from 0.5745 in the intraday comparison, and from 0.5928, which was the highest level this week. The AUD/USD traded at 0.7180 from 0.7240.
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