South Pacific Currencies Show Mixed Performance

By TraderVox.com

Tradervox (Dublin) -Despite a surplus report from the Statistics New Zealand showing that for the Month of February the country registered NZ$161 million surplus, the kiwi slightly declined against the dollar. However, on close scrutiny, this figure looks deceiving since the export volume declined by 6.9 percent which has resulted to the low demand for the Kiwi. Declines in exports were fueled by the declining petroleum and aluminum sales; further, there has been decline in exports to New Zealand’s major trading partners.

According to the report, petroleum exports dropped by 53 percent while the aluminum exports declined by 74 percent. Exports to Japan dipped by 42 percent. Japan is New Zealand’s major trading partner. The kiwi could not break the 0.8200 resistance level after the report as it dropped to 0.8160 against the greenback. The kiwi advanced against the yen by 0.1 percent to settle at 67.43 yen.

The Australian dollar climbed against the yen prior to a US report expected to report an increase in consumer confidence to a near a year high. The kiwi and the Aussie have climbed against the greenback this year due to an increase in demand of currencies linked to commodities. According to a senior analyst in Tokyo, the kiwi and the Aussie are getting their support from the elevated commodity prices; hence they have been able to withstand positive reports from the US.

The Australian dollar increased by 0.2 percent against the yen to settle at 86.37 at the close of trading in Sydney. The Aussie declined against the buck dropping from 1.0467 to 1.0443. The Aussie has however advanced 2.3 percent against the US dollar since the start of this year. The New Zealand dollar has increased 4.9 percent against the greenback.

The positive commodity prices and the positive reports from the euro area have prompted an increase in the south pacific currencies since the start of the year. However, recent concerns from China and Japan economies have forced the two south pacific currencies to pare their gains, even though marginally.

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