New Zealand Dollar Falls As Growth Data Disappoints Traders

By Eric Andersen,

THE TAKEAWAY : New Zealand 4Q GDP grew 0.3% vs. 0.6% forecast > Traders Surprised by Weaker than Expected Results > NZDUSD Drops

Data released by Statistics New Zealand showed that the country’s economy grew0.3 percent in the fourth quarter of 2011, failing to meet the 0.6percent growth rate that analysts expected. The figure was smallerthan the 0.7 percent growth rate reported in the previous period.The economy maintained a 1.8 percent growth rate from the prioryear and missed the forecasted rate of 2.2 percent.

Financial markets, agriculture, and consumer markets were the primary economic growth contributors, expanding 1.3 percent, 3.5 percent, and 2.2 percent, respectively. However, a 2.5 percent drawdown in the manufacturing industry weighed on the overall growth data.

Both growth figures fell significantly short of what the market expected, weighing on the probability that the Reserve Bank of New Zealand would raise interest rates in the near future. As a result, traders shifted their portfolios away from the Kiwi. After the release, the NZDUSD dropped from 0.815 to 0.810, only to slightly recover a few minutes later, hovering around 0.811.
DailyFX is the forex news and research arm of FXCM, Inc (NYSE: FXCM), which provides currency trading and brokerage services and is an advertiser on TheStreet websites. Any opinions, news, research, analyses, prices, or other information is provided as general market commentary, and does not constitute investment advice. Dailyfx will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information. Currency trading involves significant risk of loss. Individual authors may hold positions in the currencies discussed in the article.

Original Article: http://www.dailyfx.com/forex/market_alert/2012/03/21/New_Zealand_Dollar_Falls_as_Growth_Data_Disappoints_Traders.html

DailyFX is the forex news and research arm of FXCM (NYSE: FXCM), which provides currency trading and brokerage services and is an advertiser on TheStreet websites. Any opinions, news, research, analyses, prices, or other information is provided as general market commentary, and does not constitute investment advice. Dailyfx will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information. Currency trading involves significant risk of loss. Individual authors may hold positions in the currencies discussed in the article.

More from Currencies

Markets Wobble as U.S. Readies More China Tariffs

Markets Wobble as U.S. Readies More China Tariffs

Watch These Two Crypto Experts Fiercely Debate the Future of Regulation

Watch These Two Crypto Experts Fiercely Debate the Future of Regulation

Bitcoin Today: Prices Attempt to Rally Following Early Weakness

Bitcoin Today: Prices Attempt to Rally Following Early Weakness

Ether Prices Rally After SEC Director Says He Doesn't Consider It a Security

Ether Prices Rally After SEC Director Says He Doesn't Consider It a Security

ECB's Mario Draghi Delivers a Masterclass in Monetary Policy

ECB's Mario Draghi Delivers a Masterclass in Monetary Policy