Dollar charts new 7-year high vs. yen as Japan confirmed in recession
Dollar rose against the greenback and reached a new seven-year high against the yen.
The New Zealand dollar rose against the greenback and reached a new seven-year high against the yen as figures showed retail sales are growing faster than expected while the Japanese economy has slipped back into recession.
The kiwi touched 92.79 yen, the highest since July 2007, and was at 92.23 yen at 5pm in Wellington, from 92.24 yen in New York on Friday. It rose to 79.58 US cents from 79.15 cents at the New York close.
The kiwi initially climbed after government figures showed retail sales rose 1.5 percent in the third quarter, almost twice the forecast pace and the most in more than two years. At the same time retail prices declined, suggesting margins are being squeezed for store owners The local dollar continued to advance against the yen, which fell to a seven-year low against the greenback, after figures showed Japan's economy shrank an annualised 1.6 percent in the third quarter, adding to a second quarter contraction of 7.3 percent, to be technically in recession. Economists had expected growth to bounce back in Japan, where speculation is mounting that Prime Minister Shinzo Abe will call an election for next month.
Kiwi-yen "continues to break to new highs at an increasingly bullish rate," said Matt Simpson, senior market analyst at ThinkForex in Melbourne. "With both technicals and fundamentals favouring further upside this is not a trend I would look to fight."
"After positive retail sales for New Zealand and soft GDP data for Japan today, traders will now shift their focus to global dairy prices on Wednesday," he said in a note. "Any upside surprises here will be bullish for the kiwi dollar."
The trade-weighted index rose to 78.60 from 78.45 in New York on Friday. The kiwi traded at 50.63 British pence from 50.59 pence in New York.
Its rose to 63.40 euro cents from 63.32 cents and gained to 90.58 Australian cents from 90.52 cents.
(BusinessDesk)
Jonathan Underhill
Mon, 17 Nov 2014
Mon, 17 Nov 2014
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Dollar charts new 7-year high vs. yen as Japan confirmed in recession
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