By TraderVox.com
Tradervox (Dublin) – China’s weakening economic outlook reports led the south pacific dollars to decline against the US namesake with the New Zealand dollar losing 1.1 percent against the buck. It closed the New York session at 81.72 cents. The Aussie declined 1.2 percent to settle at $1.0480 at the close of the New York trading yesterday. Apart from China’s growth outlook, south pacific dollars were also affected by the BHP Billiton Ltd comments that production of steel was flattening.
This decline have been overturned in the Asian session today as optimism about the Europe crisis emerged after Greek Prime Minister Lucas Papademos secure parliamentary approval for the second bailout package. These reports boosted demand for higher-yielding assets increasing the demand for the Aussie and the Kiwi. Ben S. Bernanke is also expected to show his optimism today when he addresses congress. Text from his written report to the Congress indicates that he believes that the debt crisis in the region has eased.
213 lawmakers in Greece voted for the legislation to secure the bailout package while 79 of them were against the motion. This marks the biggest sovereign restructuring in the world with private investors agreeing to forsake 100 billion Euros of debt. The approval by the Greek parliament has brought new hope for the euro region which is plagued by debt crisis. Concerns still linger over the fate of Ireland and Portugal which are receiving financial assistance from IMF, and contagion concerns rise over Italy and Spain.
Reports of Greek parliament approval led to the increase of the south pacific currencies with Australian dollar increasing by 0.4 percent to settle at 1.0519 after it had declined by 1.2 percent yesterday. Against the yen, Aussie gained 0.3 percent to settle at 87.96 after it had dropped by 0.8 percent yesterday. The Kiwi also advanced against the dollar by 0.5 percent to trade at 82.09 US cents and also increased against the yen by 0.3 percent to trade at 68.63 percent.
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