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Forex - NZD/USD pulls back as risk aversion sharpens

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Forexpros - The New Zealand dollar was down against its U.S. counterpart on Tuesday, pulling back from a four-day high after a report showing German economic growth nearly stalled during the second quarter added to fears over the global economic outlook.

NZD/USD pulled back from 0.8410 during late Asian trade, the highest since August 10; the pair subsequently consolidated at 0.8297, down 0.32% on the day.

The pair was likely to find support at 0.8179, the low of August 12 and short-term resistance at 0.8415, the high of August 10.

Preliminary data released earlier showed that Germany's gross domestic product increased by a seasonally adjusted 0.1% during the second quarter, below expectations for a 0.5% increase.

The previous quarter's figure was revised down to growth of 1.3% from a previously reported 1.5% increase.

Year-on-year, German GDP grew at an annualized rate of 2.7%, after rising at a rate of 4.7% in the previous quarter and below expectations for a 3.1% gain.

Meanwhile, markets were awaiting a meeting between German Chancellor Angela Merkel and French President Nicolas Sarkozy in Paris later in the day, as the two leaders attempt to ease fears over the euro zone's ongoing debt crisis.

Elsewhere, the kiwi was higher against its Australian cousin, with AUD/NZD slumping 0.44% to hit 1.2558.

The Aussie was weighed after the minutes of the Reserve Bank of Australia's August 2 meeting showed that policy makers extended a pause on interest rates due to global growth concerns.

Also Tuesday, the U.S. was to produce official data on building permits and housing starts, as well as reports on import prices, the capacity utilization rate and industrial production.

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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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