New Zealand Dollar Plunges As Treasury Reduces Economic Growth Forecasts
Aug, 23rd 08:39
The New Zealand dollar tumbled to a one-and-a-half-month low against its American counterpart on Wednesday after the New Zealand government trimmed its surplus and growth outlook ahead of an election.
The kiwi lost more than 0.7 percent to trade at 0.7225 U.S. cents – the lowest level since July 12th in the wake of the pre-election fiscal update. The New Zealand Treasury on Wednesday reduced its economic growth forecast for the year to June to 2.6 percent, a slower pace than the 3.1 percent previously forecast.
Treasury predicted gross domestic product grew 3.5 percent in the year to June 2018, down from 3.7 per cent in the May budget update.
Meanwhile, the dollar was flat versus a basket of major currencies after traded higher overnight amidst optimism the U.S. president Donald Trump’s administration is making progress on tax reform. Investors are expected to take cautious trade ahead of an annual gathering of central bankers at Jackson Hole which is scheduled to be held later in the week.
Federal Reserve Chair Janet Yellen and European Central Bank President Mario Draghi are due to speak on Friday, though neither is expected to announce new policy messages.
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