The New Zealand Dollar soared to a new record high against the US Dollar and also gained against the Aussie following better than expected growth data.
Statistics New Zealand reported that Gross Domestic Product for the first-quarter rose 0.8% which was well above economists’ predictions of a 0.4% increase. Fourth quarter GDP was revised up to 0.5% from 0.2%.
The upbeat economic data fuels speculation that the Reserve Bank of New Zealand will increase interest rates soon.
NZDUSD rose to its highest in 30 years (since the NZD was floated) hitting 0.8505 in Asian trading from the Asian session open of 0.8375. The Kiwi’s rise against the greenback was also helped by a weaker USD which was bruised late on Thursday following a Moody’s warning on US credit rating.
Meanwhile, AUDNZD slid to an Asian session low of 1.2672 from the open of 1.2837, the lowest level in almost 8 months, amid speculation that the New Zealand central bank will raise rates sooner than its major counterpart the Reserve Bank of Australia.