The New Zealand dollar advanced after the report showed that the nation’s economy grew more than expected in the last quarter of 2010.
Statistics New Zealand reported that New Zealand’s gross domestic product expanded 0.2 percent in the fourth quarter of 2010. Analysts expected an increase by 0.1 percent. The economy shrank 0.2 percent the third quarter of the last year. The report said that the largest increases were in the manufacturing and the real estate and business services. The positive report supported the risk sentiment on markets, helping the currencies linked to growth.
Sean Callow, a senior currency strategist at Westpac Banking Corp., said:
Clearly the GDP report has been taken well by the market which was nervous about a negative number. The kiwi will do reasonably well against the U.S. dollar as risk appetite is proving to be quite resilient.
NZD/USD rose from 0.7426 to 0.7459 as of 4:27 GMT today. EUR/NZD fell from 1.8971 to 1.8864.
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