The New Zealand dollar strengthened today against its US counterpart after the report showed that the producer prices rose more than the economists anticipated, causing the speculation that the central bank may raise the interest rates further.
New Zealand output producer prices rose 1.2 percent in September, while it was expected to increase only by 0.6 percent. The output producer prices rose 0.7 percent, compared to the median forecast of the 0.4 percent growth. Previously the New Zealand dollar fell on the speculation that China, the biggest trading partner of New Zealand, would take steps to curb its inflation.
The experts say that the rising prices suggest that the inflation pressure still exists in New Zealand. This may give the reason for the Reserve Bank of New Zealand to raise the interest rates, which are already high at 3 percent compared to such countries as the US and Japan, in the beginning of the next year.
NZD/USD went up from 0.7676 to 0.7705 as of 23:45 GMT today, following its decline to the intraday low of 0.7631. EUR/NZD rose from the opening level of 1.7551 to 1.7566 after it advanced previously to 1.7662.
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