Kiwi down on weak GDP

Last updated 17:23 20/12/2012

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The New Zealand dollar fell against the greenback today, as gross domestic product (GDP) figures showed economic growth was only 0.2 per cent in the September quarter, below the 0.5 per cent forecast.

The kiwi recently traded at US83.45c, down from US83.65c earlier. It was at 74.50 on the Trade Weighted Index against major trading partners' currencies. 

ASB Institutional head of institutional FX sales Tim Kelleher said the GDP figures were disappointing. 

"It was already weak overnight before that so I wouldn't be surprised if we see it drop off further overnight [tonight]," Kelleher said.

"I think we should see some more profit taking on the crosses and as we go in to Christmas. We've pushed out our rate forecast that the Reserve Bank will not raise rates until December, because the data is not good enough to justify that at this point in time."

On the crosses, the kiwi recently traded at 79.70 Australian cents, up marginally from A79.69c earlier. It was at 63.08 euro cents, down from 63.15 euro cents earlier. Against the British pound it was at 51.31 pence, down from 51.43 pence earlier. It was at 70.27 Japanese yen, down from 70.65 yen earlier. 

Kelleher expected the kiwi to trade between US83.00c and US83.75c overnight with a bias towards the downside.

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