New Zealand Dollar hits fresh two-month highs past 0.5900 despite weak data from China
The New Zealand Dollar (NZD) keeps crawling higher against a weaker US Dollar (USD) with price action reaching the 0.5920 area for the first time since early June. Kiwi Dollar bulls did not flinch after a set of downbeat data from China on Monday and kept buying the pair, with the US Dollar depreci
The New Zealand Dollar (NZD) hit fresh two-month highs past 0.5900 despite poor economic data from China. The currency's strength was driven by a weaker US Dollar (USD) and a bearish outlook on the Federal Reserve's rate hike in September. China's Industrial Production growth slowed to 4.5% in the year to July, below market expectations of 5%, compared to a 5.3% rise in June.
Retail Sales also slowed to 0.6% yearly growth in July, less than half the 1.5% expected. Despite acknowledging extreme weather conditions impacted growth, Chinese authorities stated the trend remained unchanged. The NZD gained support from a soft USD, which opened the week on a weak tone. Analysts noted that US retail sales data and expectations for a 50bp tightening cycle into next year had scaled back to 35bp. Following the meeting, analysts will closely monitor the minutes for clues on the Fed's stance.
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