New Zealand’s dollar fell versus most of its global currency peers after a report today showed business confidence in the nation dropped to a 15-month low.
The kiwi weakened following an advance last quarter, when two interest-rate increases from the Reserve Bank of New Zealand further boosted what was already the highest borrowing cost among developed economies. Australia’s currency was 0.5 percent from the least in more than two weeks before a private report on business sentiment. The yen remained higher after its biggest one-day gain in a week, following data that indicated Japan’s current-account surplus in May was more than analysts expected.
The confidence data “did produce that knee-jerk reaction in the kiwi,” said Sean Callow, a senior currency strategist at Westpac Banking Corp. in Sydney. “Kiwi bears will continue to find it difficult to fight the flow when the RBNZ is likely to hike again.”
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