COZfx: NZD/USD lowers on Bernanke comments

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COZforex: The New Zealand dollar was lower against its US counterpart on Wednesday, despite positive inflation data out of New Zealand, as comments by Federal Reserve Chairman sent the greenback broadly higher.

NZD/USD hit 0.8326 amid late Asian trade, the session low; the pair subsequently consolidated at 0.8337, shedding 0.43%. Meanwhile, NZD/USD was likely to find support at 0.8268, the low of November 15 and resistance at 0.8415, the high of November 6.

Official data earlier showed that producer price inflation input rise 2.2% in the third quarter, exceeding expectations for a 0.6% uptick, after a 0.6% rise in the 3 months to June. Producer price inflation output rise 2.4% in the last quarter, more than the expected 1% increase, after a 1% rise in the second quarter.

The greenback strengthened after Bernanke said the Fed would maintain its accommodative monetary policy for as long as needed and would taper its USD85 billion-a-month asset purchase program only when it was sure that improvements in the labor market would continue.

Interest rates will probably remain near zero for a “considerable time” after the bank winds up asset purchase program, he added.

Last week Janet Yellen, who has been nominated to succeed Ben Bernanke, reiterated the need for continued stimulus to ensure a robust economic recovery.

Investors were turning their attention to the minutes of the Fed’s October meeting due later Wednesday for further indications on the future course of US monetary policy.

Later in the day, the US was to release a report on retail sales and the government measure of consumer spending, as well as data on consumer inflation, existing home sales and business inventories.

(COZ forex UK)