FXStreet (Mumbai) – The New Zealand dollar extends its downward spiral versus the American dollar in the early-Asian trades, knocking-off NZD/USD to the lowest levels since July 2010. The Kiwi remains relentlessly sold-off as traders continue to absorb the latest NZ GDP print which showed that first-quarter economic growth figures for the dairy-producing nation came in well below forecast.
NZD/USD extends losses on weak NZ GDP data
Currently, the NZD/USD pair drops -1.24% to 0.6900, retreating from close to five year low reached at 0.6881. NZD/USD remains heavy in Asia after poor NZ GDP data which showed that GDP growth was just 0.2% in the March quarter, according to Statistics New Zealand, coming in much weaker than the market and the RBNZ’s forecast expansion of 0.6%. December quarter growth was revised lower from 0.8% to 0.7%.
The latest GDP print also revealed that New Zealand’s economy expanded at the weakest pace in two years last quarter largely as dairy and mining output slumped.
This highlights increasing probabilities that the Reserve Bank of New Zealand (RBNZ) will cut interest rates for the second time in a row next month, which further dragged the Kiwi lower.
Later today, US data flow including the key US CPI figures, will provide fresh cues on the US dollar moves having major impact on the NZD/USD pair.
NZD/USD Levels to consider
To the upside, the next resistance is located at 0.6941 (June 12 Low) levels and above which it could extend gains 0.7000 levels. To the downside immediate support might be located at 0.6874 (June 17 Low) below that at 0.6800 (July 2010) levels.
(Market News Provided by FXstreet)