The New Zealand dollar staged a sharp rally against its major counterparts in early Asian trading on Thursday after the Statistics New Zealand report showed that the nation’s unemployment rate in the first quarter rose less than analysts had predicted.
The unemployment rate in New Zealand came in at a seasonally adjusted 6.0 percent in the first quarter of 2010, Statistics New Zealand said today, marking the first decrease in the unemployment rate since the December 2007 quarter.
It was also far better than forecasts for a 7.3 percent rise following the revised 7.1 percent increase in the previous three months.
Statistics NZ said the number of employed New Zealanders increased 1.0 percent on quarter, but was down 0.1 percent from one year earlier.
The number of unemployed people declined 25,000 in the quarter while the number of people employed increased by 22,000.
The kiwi climbed to 1.7628 against euro by 7:20 pm ET Wednesday, the highest level since late July 2007. On the upside, 1.75 is seen as the next likely resistance level for the NZ dollar. The euro-kiwi pair that closed Wednesday’s North American deals at 1.7879 is presently quoted at 1.7680.
The euro continued its selling pressure as concerns regarding the civil unrest and financial turmoil in Greece prompted traders to pull capital out of the markets.
Against the Australian dollar, the New Zealand currency advanced to a multi-month high of 1.2480 before holding steady around 7:20 pm ET Wednesday. If the kiwi strengthens further, resistance level is likely to be seen around the 1.2420 level. The aussie-kiwi pair that was worth 1.2646 at Wednesday’s New York session close is currently quoted at 1.2507.
Australia is set to release its retail sales and trade balance data shortly. Analysts expect the seasonally adjusted retail sales rose 0.7 percent in the month, while at the same time, the trade deficit widened to 2.12 billion from 1.92 billion deficit in the previous month.
The New Zealand dollar that fell to a 1-week low of 0.7146 against the US dollar on Wednesday appreciated by more than 1.8 percent to touch a 2-day high of 0.7278 by 7:20 pm ET and the pair moved in a holding pattern thereafter. The kiwi-buck pair that closed yesterday’s deals at 0.7181 is presently quoted at 0.7268.
The New Zealand dollar that closed yesterday’s deals at 67.32 against the Japanese yen reached as high as 68.38 before shedding a few pips by 7:20 pm ET Wednesday. The kiwi-yen pair is presently quoted at 68.20.
Looking ahead, the European Central Bank will announce its latest interest rate decision at 7:45 am ET. Analysts expect the rate to remain at 1 percent.
Turning to the North American session, the markets are likely move in reaction to data on jobless claims and productivity along with comments from Federal Reserve Chairman Ben Bernanke.