Jobless Rates Push New Zealand Dollar Down

The New Zealand dollar lost versus most of the 16 main traded currencies this Thursday as the quarterly unemployment rate in the country grew further, decreasing attractiveness for the kiwi, as growing unemployment figures are a sign of bad economic health.

The Reserve Bank of New Zealand Governor Alan Bollard affirmed that a strong currency is likely to slowdown the economic recovery process that the South Pacific nation is experiencing, raising concerns among traders that further rallies for the kiwi will eventually suffer interventions from the national central bank, declining even further the attractiveness for the kiwi, as the unemployment rate rose to 6.5 in the past quarter, the highest in 9 years and 0.5 percent more than the previous quarterly reading this year, affecting negatively the kiwi performance as stocks and commodities also dropped worldwide, a negative fact for the South Pacific region due to its commodity exporter economic profile.

Both analysts and policy makers in New Zealand admit the problems the country faced during the worst moments of the recession and considering its recovering process more complicated than the one in Australia, even if the kiwi is together with the Aussie, ranking among the 3 best performers in foreign-exchange markets in 2009, since despite its problems, New Zealand has been showing a stronger resilience than other wealthy nations in the world.

NZD/USD traded at 0.7211 as of 13:15 after touching 0.7308 yesterday. NZD/JPY traded at 65.17 from 66.43.

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