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NZ dollar rises on better than expected retail sales data

The New Zealand dollar rose today after retail sales data was better than expected.It was 71.41USc at 5pm, having risen more than half a US cent in response to the data. It was 71.89USc at 8am and 71.27USc at 5pm on Friday.The local currency had earlier f

NZPA
Fri, 13 Aug 2010

The New Zealand dollar rose today after retail sales data was better than expected.

It was 71.41USc at 5pm, having risen more than half a US cent in response to the data. It was 71.89USc at 8am and 71.27USc at 5pm on Friday.

The local currency had earlier fallen below 71USc for the first time in three weeks, after weekly jobless claims rose unexpectedly in the US and euro zone data was weaker than expected, spurring safe-haven demand.

But news that retail sales volumes surged 1.3% in the June quarter returned investors' focus to the local economy. This compared to expectations of about a 0.3% rise.

"The market has got so used to rubbish data and this one popped out as a surprise," said Imre Speizer, senior currency strategist at Westpac. "I still think the kiwi is weak overall on a multi-week basis. I think it topped out about a week ago."

The surprise boost to sales volumes may see some forecasters revise up their picks for second quarter gross domestic product, Westpac economists said in a commentary.

"For now we're comfortable with our forecast of 0.7% GDP growth, which incorporates a 0.7% rise in private consumption," Mr Speizer said.

The data also kept alive the chances of another rate rise by the central bank in September.

The NZ dollar was at €0.5555 at 5pm from €0.5536 at the same time yesterday and at ¥61.46 from ¥60.78 yesterday. It was at 79.28Ac from 79.57Ac yesterday.

The trade weighted index rose to 66.70 from 66.51 yesterday.

NZPA
Fri, 13 Aug 2010
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NZ dollar rises on better than expected retail sales data
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