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Forex - NZD/USD edges higher on N.Z. budget report

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Investing.com -

Investing.com - The New Zealand dollar edged higher against its U.S. counterpart on Thursday, despite disappointing manufacturing data from New Zealand, as the country's government projected the first surplus in seven years.

NZD/USD hit 0.8686 during late Asian trade, the pair's highest since May 7; the pair subsequently consolidated at 0.8692, rising 0.28%.

The pair was likely to find support at 0.8604, the low of May 9 and resistance at 0.8780, the high of May 6 and a two-and-a-half year high.

Data earlier showed that the Business New Zealand Manufacturing Index fell to 55.2 in April, from 58.0 in March, whose figure was revised down from a previously estimated reading of 58.4.

Meanwhile, in its annual budget release, New Zealand's Treasury said the operating surplus will be NZ$372 million in the year through June 2015, up from a previously forecast NZ$86 million.

The Treasury also forecast the nation's jobless rate will decline to 4.4% in 2018 from a projected 5.4% next fiscal year.

The report came after Reserve Bank of New Zealand Chairman Graeme Wheeler said last week that the speed and extent of further interest rate increases will depend on economic performance and how much the nation's strong currency weighs on inflation.

The central bank has already raised its benchmark interest rate twice this year, after keeping at a record low 2.5% to support the economy.

The kiwi was higehr against the euro, with EUR/NZD edging down 0.25% to 1.5781.

Later in the day, the U.S. was to release data on initial jobless claims, consumer inflation and industrial production, as well as a report on manufacturing activity in the Philadelphia region.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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