The NZD was trading slightly higher late Wednesday but its gains were capped toward the end of the New Zealand session as investors picked the AUD over the Kiwi. The AUD rallied after data released earlier in the day showed Australia’s 2011 fourth-quarter trimmed mean consumer price index gained 0.6%, which suggested to some in the market that the Reserve Bank of Australia might keep its key interest rate on hold in February after two previous cuts. Meanwhile, Australia’s CPI was unchanged in the fourth quarter from the third quarter, and rose 3.1% from a year earlier, the Australian Bureau of Statistics said Wednesday. Economists had expected it to rise 0.2% from the previous quarter and 3.3% from a year earlier. New Zealand government bonds pushed lower, tracking the moves of Australian bonds following Australia’s inflation data earlier in the day, a local bond trader said.
EasyForexNews Research Team