Kiwi touches eleven month high as account deficit narrowed

Kiwi touches eleven month high as account deficit narrowed

09-21-2009 15:12

The New Zealand Dollar, often called Kiwi Dollar, reached an eleven-month record high against the US Dollar and rose against the majority of the 16 most popular currencies due to global and local factors, alluring traders to invest in New Zealand Dollar-priced assets. The Kiwi posted one of the best results in the Forex market this Tuesday.

Account deficit narrowed

New Zealand’s current account deficit contracted to the weakest level in 4 years today, which suggests that the New Zealand Dollar continues its economic recovery. Since New Zealand is a supplier of dairy products, the nation also boosted the Kiwi to gain as prices of agricultural commodities are expected to increase during the next year, the Fonterra Cooperative Group Ltd forecasts, making the Kiwi Dollar more interesting for investors.
The outlook by the Asian Development Bank, a multilateral development financial institution, shows that the Pacific economies will recover faster, increasing risk appetite among investors that preferred South Pacific assets this Tuesday’s trading session.

Further gains

Global and local circumstances are favorable for the New Zealand Dollar to continue its gains. New Zealand has one of the most resilient economies among the richest nations worldwide, which has a positive influence on the demand for Kiwi-priced investments. At the moment, New Zealand trading options are one of the highest yielding investments, as the Kiwi is associated with commodities, fact which provides support to grow further towards the end of 2009.