The New Zealand dollar pared back some of Wednesday’s gains after lower-than-forecast GDP readingfor the last quarter of 2016 was announced by Statistics New Zealand (SNZ).
The agency’s release said New Zealand's economy grew only 0.4 percent in the fourth quarter of last year, which was 0.3 percent lower than analysts' estimates of 0.7 percent. The gains were mainly in the services sector, said SNZ:
“Business services was up 1.7 percent, due to computer system design and related services and advertising, market research and management services.”In the last quarter of 2016, manufacturing posted declines of 1.6 percent, while exports dropped by 3.8 percent.
On Wednesday, during the New York Forex session, the NZD/USD rate was pushed higher by approximately 1.8 percent to a 12-day high of 0.70495, when the U.S. Federal Reserve decided to raise interest rates to 1%, weakening the dollar.
However, the disappointing New Zealand GDP figure which was released at 5:45 p.m. EST, sent the NZD/USD rate lower by 0.52 percent to 0.70:
NZD banknotes photo by Karl Baron