Forexpros – The New Zealand dollar rallied to a three-day high against its U.S. counterpart on Tuesday, as better-than-anticipated data on Chinese manufacturing activity eased fears over a slowdown in the world’s second largest economy.
NZD/USD hit 0.8326 during late Asian trade, the pair’s highest since August 18; the pair subsequently consolidated at 0.8320, jumping 0.98%.
The pair was likely to find support at 0.8157, Monday’s low and resistance at 0.8424, the high of August 17.
A preliminary reading of the HSBC’s China purchasing managers’ index inched up to 49.8 in August, from a final reading of 49.3 the previous month. A number below 50 indicates contraction in the sector.
There had been some speculation that the reading may turn out to be much weaker. China is New Zealand’s second largest export destination.
The kiwi was also higher against its Australian cousin, with AUD/NZD shedding 0.22% to hit 1.2599.
Also Tuesday, the Reserve Bank of New Zealand reported that inflation expectations declined in this quarter, dipping below 3% to hit 2.9%.
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