New Zealand Dollars Fall on Asian Sentiment Scenario

The New Zealand currency fell versus the U.S. dollar and the yen after speculations suggested that Japanese investors are repatriating capital invested abroad and Asian stocks had a rather bearish start of the week declining investors’ appetite for risk.

After Japan’s Finance Minister Hirohisa Fujii‘s declarations suggesting that the national government is unlikely to intervene in the yen’s movements in currency markets, the attractiveness for the New Zealand dollar declined, as Japanese investors repatriated assets, consequently affecting the kiwi negatively. The worst day in September for trading in Asian stocks also influenced the previous high risk appetite that favored the kiwi last week, this time pushing investors to opt for safer positions, purchasing dollar and yen-priced assets.

A specific combination of international factors reflected negatively in the New Zealand currency today as a decline in risk appetite added to improved attractiveness benefiting the yen, forced not only the kiwi but its Australian counterpart down today in foreign-exchange markets. Analysts speculate that the current levels for stocks may not reflect the actual economic conditions in most of the global economic regions, which can be interpreted by a downmarket sentiment today that cause the sharpest fall in Asian stocks in a period of six weeks.

NZD/USD traded at 0.7130 as of 14:00 GMT from 0.7214 yesterday. NZD/JPY followed the same trend trading at 63.77 from 64.17.

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