BLBG:N.Z. Dollar Drops Amid Europe Crisis, After Current-Account Deficit Report
New Zealand’s dollar weakened versus the yen after the nation posted a current-account deficit that was wider than economists estimated.
The so-called kiwi dropped against all its major peers on concern Europe’s debt crisis will worsen. It maintained a two- day decline against the U.S. counterpart as Greece’s one-year debt yields held near a record high. The Australian dollar erased earlier losses against the greenback as Asian stocks rose, supporting demand for higher-yielding assets.
“The report on the current-account deficit is negative for the kiwi,” said Daisaku Ueno, president of Gaitame.com Research Institute Ltd. in Tokyo, a unit of Japan’s largest online currency broker. “Europe’s debt crisis is a catalyst for risk off, weighing on the Australian and New Zealand dollars.”
New Zealand’s currency fell to 82.35 U.S. cents at 2:30 p.m. in Sydney from 82.42 cents in New York yesterday. It declined to 62.87 yen from 63. Australia’s dollar traded at $1.0288 from $1.0276, after earlier falling as low as $1.0234. The currency bought 78.54 yen from 78.57.
The MSCI Asia Pacific Index of stocks rose 0.5 percent after falling 0.5 percent yesterday.
New Zealand’s current-account deficit was NZ$921 million ($757 million) in the second quarter, Statistics New Zealand said today. The median estimate in a Bloomberg News survey of economists was for a shortfall of NZ$671 million.
Greek Finance Minister Evangelos Venizelos made “good progress” in a second round of talks with the European Union and International Monetary Fund yesterday aimed at staving off default, the EU said. An EU statement said a “full mission” will return to Athens next week after Venizelos’s talks in coming days at the IMF annual meeting in Washington.
Greece’s one-year bill yields were at 129.69 percent yesterday, after touching 148.90 percent on Sept. 14.
To contact the reporter on this story: Mariko Ishikawa in Tokyo at mishikawa9@bloomberg.net. Masaki Kondo in Singapore at mkondo3@bloomberg.net.
To contact the editor responsible for this story: Rocky Swift at rswift5@bloomberg.net.
