Forex News

After gaining for two consecutive days versus important currencies like the euro and the U.S. dollar, the kiwi currency didn’t manage to sustain its trend after central bankers in the country affirmed that lack of economic improvements in the South Pacific nation will delay interest rate hikes.

The New Zealand dollar has been impacted by a decline in risk appetite globally on growth concerns in Europe and North America, but today, after the country’s trade balance showed a smaller trade deficit, the currency rebounded.

The New Zealand dollar started this Friday losing versus currencies from its main trading partners as central bankers from Australia and the U.S. are adopting a hawkish tone leaving the New Zealand dollar less attractive as rate hikes are not forecast in the short term for the kiwi nation.

The New Zealand dollar started this Thursday falling sharply versus virtually all main traded currencies as its unemployment rate reached the highest rates in a decade, suggesting that the South Pacific economy is far from a complete recovery.

After losing significantly during most of this Wednesday’s session as risk aversion prevailed globally, the kiwi rebounded in currency markets as retail sales advanced in the country reviving the confidence regarding the Southern Pacific economy.

The dollar gained today versus most of the 16 main traded currencies as China tightened its lending restrictions, raising risk aversion in foreign-exchange markets affecting high-yielding currencies the most, as investors search for safer bets.

This Friday’s shift in market sentiment allowed the U.S. dollar to post a weekly advance versus most of the main higher-yielding currencies, as risk aversion rose globally and traders opted by the relative safety provided by dollar-priced assets.

The New Zealand dollar lost versus most of the 16 main traded currencies this Thursday as the quarterly unemployment rate in the country grew further, decreasing attractiveness for the kiwi, as growing unemployment figures are a sign of bad economic health.

The New Zealand dollar had a good performance today gaining versus the dollar and the yen after government officials did not relate a strong kiwi with eventual delays in interest rate hikes, adding speculations that the South Pacific country is on the way to raise its benchmark interest rates.

This Tuesday, a report posted in New Zealand surprised economists’ forecasts as retail sales in the South Pacific country came with better-than-expected growth, adding optimism to the already attractive kiwi, one of the best performing currencies in foreign-exchange markets in 2009.