FXstreet.com (London) - The Kiwi bumped up last week as Central Bank governor Alan Bollock indicated borrowing costs could be raised earlier than anticipated, quoting mid 2010. Aussie dollar followed one of its closest linked currencies.
As high-yielding currencies both the Kiwi and the Aussie are affected by sways in investor sentiment and benefit from risk appetite and the carry trade.
In early trading markets seem soft for both as investors look to the larger global economies for cues, despite being buoyed last week by a stronger housing market. NZD/USD currently trades at 0.7234/6, and AUD/USD at 0.9107/8.
In case of breakout from the current levels Kiwi primary support and resistance can be seen as 0.7220 (Dec 11 Low) and 0.7287 (Dec 11 High) respectively.
Bullish growth indicators are expected tomorrow, when NZ publishes it half-year fiscal update, according to The New Zealand Herald: Overall, it expects the effects of tax cuts and lower profits to outweigh growth in wages and consumption, resulting in a fall in total tax revenue over the full year, despite a recovery in economic activity.The recovery has come sooner and is looking stronger than the Treasury forecast in the May Budget.