September 24th, 2014 Guest post by Jay Hawk at Orbex.
The Kiwi recovered some recently lost ground against the U.S. Dollar and other major currencies today after trading at its lowest level versus the Greenback since September of 2013 in yesterday’s session.
The gain in the currency was in large part due to a considerably narrower than expected deficit in the New Zealand Trade Balance. Statistics New Zealand reported today that the country’s trade deficit had contracted to -472 million NZD in August from a revised deficit of -724 million NZD in July. This impressed market analysts who had expected a wider trade deficit of -1.13 billion.
Exports gained +6.9% from one year ago to $3.52 billion, but were down -4.4% from July. Analysts were expecting exports to be approximately $3.2 billion in August. Exports were mostly driven by an increase in overseas butter and cheese sales, as well as powdered milk exports, which increased +16% from a year ago. Imports declined by -11.8% from the previous year to 4.0 billion NZD but were still -9.4% lower than the 4.41 billion NZD reported in July.