Forexpros – The New Zealand dollar tumbled to a more than one-month low against its U.S. counterpart on Thursday, as uncertainty over the ability of Italy’s next government to overcome the country’s debt woes dented risk appetite.
NZD/USD hit 0.7731 during late Asian trade, the pair’s lowest since October 12; the pair subsequently consolidated at 0.7741, dropping 0.94%.
The pair was likely to find support at 0.7676, the low of October 10 and resistance at 0.7900, the high of September 28.
Risk appetite was hit as Italy’s ten-year bond yields closed at a euro-era high of 7.25% on Wednesday, after the promised exit of Prime Minister Silvio Berlusconi failed to convince investors that the next government will be able to slash the country’s soaring debt.
Failure to implement the much needed austerity measures could lead Italy to join Greece, Portugal and Ireland in seeking outside support.
Meanwhile, Greek leaders had still not managed to determine who will head the new coalition government.
Earlier Thursday, government data showed that core machinery orders in Japan declined more-than-expected in September, falling 8.2% after a 11.0% increase the previous month.
Analysts had expected core machinery orders to fall 7.3% in September.
Japan is New Zealand’s second major export partner.
Elsewhere, the kiwi was down against the Australian dollar with AUD/NZD rising 0.20%, to hit 1.3008.
Also Thursday, official data showed that the number of employed people in Australia rose by 10,100 in October, in line with expectations, while the unemployment rate declined more-than-expected, ticking down to 5.2% after a reading of 5.3% in September.
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