The New Zealand dollar is the best performing currency in the foreign exchange market today. Against the US dollar, the kiwi is up 0.8 percent and against the Japanese Yen it is up 1.15 percent.
With retail sales and the Reserve Bank of New Zealand rate decision this week, the currency pair is in play. After the past 2 week?s sharp losses, the faster than expected producer price growth in the second quarter came as a welcome surprise. It has also helped the currency outperform the Australian dollar, which was weighed down today by softer than expected home loans data. Technically, the New Zealand dollar looks poised for more gains, as long as there isn?t another massive wave of carry trade liquidation over the next few days.
Written by Kathy Lien, Chief Currency Strategist of DailyFX.com