Thursday, 27 August 2009

Risk caution over the kiwi, rallies sterling

The pound has finally capped its losses against the kiwi as cautious investors suspect that the risk rally may have gone too far.
• Sterling initially fell further against the kiwi yesterday evening as the investment trend continued to favour riskier assets.
• However, a weaker-than-expected New Zealand trade balance figure released late last night saw investors return to caution, which capped the kiwi’s gains.
• A fall in Chinese stocks added to selling pressure on the kiwi, with investors cautious about the pace of New Zealand’s recovery.
• The pound is currently trading 0.07% up for the day, but with CBI Realised sales data to be released at 11:00BST, a positive reading could extend these gains.
• The New Zealand monthly building consents data is released today at 23:45BST, which will give investors a good insight into the current economic health of the economy.

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