New Zealand returned to positive territory against the greenback on Friday, after tumbling to session lows following an earthquake striking New Zealands capital city, while investors awaited the last set of crucial economic reports for this week out of the United States.
NZD/USD fell from two-month highs to reach a session low at 0.8059 at 5:41. At 8:06 GMT the pair was trading at 0.8092, up by 0.20%.
The New Zealand dollar reduced its gains after an earthquake with magnitude of 6.6 and two powerful aftershocks struck New Zealands central area. The quake shook the capital city of Wellington, but there were no immediate reports of injuries, Bloomberg imparted.
“As a general rule of thumb, the market tends to overreact to earthquakes in New Zealand specifically and to natural disasters in general,” said Todd Elmer, a foreign-exchange strategist at Citigroup Inc. in Singapore, cited by Bloomberg. “We expect continued outperformance from the kiwi.”
Meanwhile, yesterdays mixed data out of the United States raised concerns over the pace at which economic recovery in the country was going. However, 65% of experts surveyed by Bloomberg, expect that the Federal Reserve Bank will reduce the scale of its bond purchases from the current 85 billion USD per month during September, as the FOMCs initial move is expected to be a tapering by 10 billion USD to 75 billion USD, as showed in a survey conducted on August 9th-13th.
Elsewhere, the kiwi dollar was lower against the Australian dollar, with AUD/NZD cross advancing 0.35% to trade at 1.1370 at 8:23 GMT.
TradingPedia.com is a financial media specialized in providing daily news and education covering Forex, equities and commodities. Our academies for traders cover 
