Better-than-expected GDP figures in the US caused risk appetite to surge across the board enabling the kiwi to post gains of over a cent against the pound.
- The solid GDP figure in the US renewed optimism about recovery in the global economy, prompting investors to buy higher-yielding currencies.
- The kiwi, which has suffered recently on a rise in risk aversion, was able to reverse losses as the positive data encouraged investors to buy up riskier assets.
- However, in trading this morning, the pound is recouping losses, pushing the price back near 2.27 as market participants return their thoughts to the RBNZ’s rate statement on Wednesday where they indicated that interest rates would not be raised for some time.
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- Demand for the kiwi remained strong yesterday, but it has lost ground in the wake of comments from Ben Bernanke
- Sterling made gains against the kiwi yesterday, but rising risk appetite has supported kiwi advances today
- The kiwi edged higher against the pound but has weakened this morning following important Chinese data
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