High Risk Appetite Boosts New Zealand Dollar

The New Zealand dollar rose today against other
most-traded counterparts as the outlook for Greece to receive the rescue package valued as much as €110 billion ($146 billion) improved the investors’ risk sentiment and attracted them to the South Pacific nation’s higher-yielding assets.
The investors are attracted to New Zealand because of its high interest rates, which is 2.5 percent, compared to 0.1 in Japan and about zero in the U.S., but as such trades carry risk that the profits would be erased by the moves at the currency markets, the investors’ risk appetite has to be high enough to encourage them use differences in the interest rates. And the prospect for the Greece to receive the aid soon makes the investors more willing to risk.
NZD/USD traded near 0.7294 as of 11:57 GMT today after it opened at 0.7291. EUR/NZD traded at about 1.8137 after opening at 1.8275.
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Concern About Greece’s Bailout Hurts Euro

The euro dropped today as the doubts arouse that Greece won’t receive the €110 billion aid package, which are supposed to be provided by the European Union governments and the International Monetary Fund.

The EU leaders are going to discuss at their meeting on May 7th the details of the bailout, which may require from Greece to cut its budget spendings. Such measures are considered too severe by the Greece’s citizens and are speculations about the possible budget cuts caused protests among Greeks.
EUR/USD dropped to 1.3234 today as of 13:27 GMT from the opening level of 1.3329.

Canadian Dollar Goes Up on Commodity Prices, Rising Stocks

The Canadian dollar advanced today as the crude oil prices surged to the highest level since September 2008, U.S. stocks gained and gold climbed to the highest level since November 2009.
The Canadian currency depends on the prices for the commodities, especially crude oil, being the key export commodity of the nation, therefore the price increase bodes well for the Loonie. The expectation for the central bank to increase the interest rates as soon as of June or by July also supported the currency’s performance.
Still, the concern that the bets for the rates increase were overdone has already slashed the currency previously, so many economists look forward for the central bank’s meeting in June to clarify the Loonie’s future moves. The reports about the employment this week may give suggestions to the Canadian dollar’s performance in the near term.

Zloty Hits Record High on Rate Talks

The Polish zloty is facing a scenario different from its neighboring currencies in the Baltics, central Europe and the euro as interest rates may rise in the following months to control the country’s growing inflation, helping the zloty to climb in forex markets this Thursday.
After a Polish government official stated that interest rates may be hiked in the second half of this year to prevent inflation to grow beyond the nation’s targets, the zloty reached the highest price in more than a year versus the currently unattractive euro.
EUR/PLN closed at 3.8963 from an opening rate of 3.9088 this Thursday.

IPO Boosts Demand for Brazilian Real

The Brazilian real is starting this month extending last week’s advance and reverting a negative trend from the beginning of the year, as the appeal for assets in the country are attracting foreign capital inflows and helping the real to beat a number of currencies in
foreign-exchange markets.
Brazil has one of the highest interest rates around the world and renewed appetite for risk in equities markets are allowing the South American currency to post a series of gains versus important currencies with different economic profiles, specially before an IPO in Bovespa which may raise up to $5 billion, considering a significant part of this amount composed by foreign capital. Interest rates in Brazil may rise also in the following months, making the real to repeat last year’s story with the Aussie dollar to rank among the top performing currencies in forex markets.
Optimism is back, and now that pessimism coming from EU’s fiscal crisis and new lending requirements in the U.S. and China cooled down, the scenario for the real has really improved. If risk appetite continues to climb to real may reach new record lows, specially versus the pound and the euro.
USD/BRL closed this Monday at 1.7985 from an opening rate of 1.7995.

Euro Up on Greek Hopes

The euro emerged versus several important currencies as Greece will propose a strategy to solve its budget deficit crisis, declining pessimism among investors to purchase assets in the Eurozone.
The Eurozone had a breather today after Greece, the main responsible for the euro’s most recent downtrends, announced through government officials that decisions are likely to be presented anytime to soon to tighten the countries massive budget deficit, increasing optimism that the fiscal crisis is likely to find a solution in the mid-term.
EUR/USD traded at 1.3633 as of 02:49 GMT from a previous intraday rate of 1.3517.

Chilean Peso Climbs After Earthquake

The Chilean peso oddly profited from a natural tragedy that impacted the country in the first night of this month, as speculations suggest that the reconstruction process in the country, will allow the country’s economy to accelerate.
The South American country is likely to repatriate reserves invested overseas to promote a quicker restructuring in the country after Chile was shook by an earthquake this weekend, allowing the peso to rank among the best performing currencies this Tuesday in forex markets.
USD/CLP closed at 519.05 this Tuesday from an opening rate of 523.25.