Investing.com - The New Zealand dollar fell to a one-year low against its U.S. counterpart on Friday, after the Federal Reserve indicated that it may start to unwind its asset purchase program later this year.
hit 0.7699 on Friday, the pair’s lowest since June 12, 2012; the pair subsequently consolidated at 0.7733 by close of trade on Friday, down 3.8% for the week.
The pair is likely to find support at 0.7699, Friday’s low and a 12-month low and resistance at 0.7806, Friday’s session high.
The dollar rallied after Fed Chairman Ben Bernanke said Wednesday that the bank could begin slowing its USD85 billion-a-month bond purchasing program by the end of 2013 and wind it down completely by the middle of 2014 if the economy picks up as the central bank expects.
The bank said it expects the U.S. economy to grow between 2.3% and 2.6% in 2013. The Fed also said it expects the unemployment rate to fall to between 6.5% and 6.8% by the end of 2014 and inflation to edge closer to its 2% target.
Sentiment on the Kiwi was further dampened after data Thursday showed that manufacturing activity hit a nine-month low in June.
China’s HSBC preliminary manufacturing purchasing managers’ index fell to 48.3 in June from 49.2 in May as new orders declined, indicating that the slowdown in manufacturing is worsening.
The Asian nation is New Zealand's second biggest export partner.
Meanwhile, in New Zealand, official data released Thursday showed that New Zealand's gross domestic product rose 0.3% in the first quarter, disappointing expectations for a 0.6% increase, after a 1.5% rise in the previous quarter.
In the week ahead, investors will be closely watching U.S. data on durable goods orders, jobless claims and consumer confidence for signs that the economic recovery is on track.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets. The guide skips Monday as there are no relevant events on this day.Tuesday, June 25
The U.S. is to publish official data on durable goods orders, a leading indicator of production, as well as closely watched reports on consumer confidence and new home sales.Wednesday, June 26
The U.S. is to release revised data on first quarter economic growth as well as government data on crude oil stockpiles.Thursday, June 27
New Zealand is to release official data on the trade balance, the difference in value between imports and exports, as well as data on business confidence.
Later Thursday, the U.S. is to release the weekly government report on initial jobless claims along with data on personal income and expenditure, which is to be followed by private sector data on pending home sales.Friday, June 28
The U.S. is to round up the week with a report on manufacturing activity in Chicago and revised data from the University of Michigan on consumer sentiment.