Forexpros – The New Zealand dollar was sharply higher against its U.S. counterpart on Tuesday, as market sentiment slightly improved amid ongoing concerns over the debt crisis in the euro zone.
NZD/USD hit 0.7859 during late Asian trade, the pair’s highest since December 8; the pair subsequently consolidated at 0.7848, gaining 0.82%.
The pair was likely to find support at 0.7750, the low of January 2 and resistance at 0.7927, the high of November 14.
The kiwi rallied to a four-week high as risk sentiment strengthened after data on Sunday showed that Chinese manufacturing activity expanded in December after contracting the previous month.
Meanwhile, investors were eyeing a series of important events this month, including German and French bond auctions later in the week.
French President Nicolas Sarkozy and German Chancellor Angela Merkel are also due to meet on January 9 in order to discuss new rules to enforce budget discipline across the European Union.
Elsewhere, the kiwi was higher against the Australian dollar with AUD/NZD declining 0.19%, to hit 1.3119.
Earlier Tuesday, the Reserve Bank of Australia said that commodity prices rose 10.9% in December, after a 17.5% increase the previous month.
November’s figure had been revised down from 18.1%.
Later in the day, the U.S. Institute of Supply Management was to publish a report on manufacturing activity and the Federal Reserve was to publish the minutes of its December policy meeting.
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