2014.11.2603:26:00UTC+00NZ Dollar Strengthens On U.S. Optimism

The New Zealand dollar drifted higher against its major rivals ahead of European deals on Wednesday, extending previous session's gains, as positive GDP data released from the U.S. overnight offset concerns over global economic outlook.

The Commerce Department released a report showing that gross domestic product in the U.S. increased by 3.9 percent in the third quarter compared to the previously reported 3.5 percent increase.

The upward revision came as a surprise to economists, who had expected the pace of GDP growth to be downwardly revised to 3.3 percent.

Traders eye more U.S. data later in the day, including reports on jobless claims, durable goods orders, personal income and spending as well as new home sales and pending homes sales figures ahead of Thursday's Thanksgiving holiday.

Statistics New Zealand will release NZ's trade data for October tomorrow. Trade deficit is seen at NZ$642 million, narrower than NZ$1.35 million recorded a month earlier.

The kiwi advanced to 1.0901 against the aussie, its highest since July 24. Next key resistance for the kiwi may be located around the 1.08 zone.

The value of total construction work done in Australia dropped in the third quarter, preliminary figures from Australian Bureau of Statistics showed.

Total construction work done dropped a seasonally adjusted 2.2 percent sequentially in the third quarter. Economist had forecast a 1.9 percent fall for the September quarter.

The kiwi reversed from early lows of 91.96 against the yen and 0.7801 against the greenback, rising to 92.41 and 0.7850, respectively. If the kiwi extends rise, 93.7 against the yen and 0.795 against the greenback are seen as its next possible resistance levels.

After falling to 1.5979 against the euro at 5:00 pm ET, the kiwi edged up to 1.5877. The kiwi is likely to challenge resistance around the 1.58 mark.

Germany's import prices continued to decline but the pace of decrease slowed in October, figures from Destatis showed.

The import price index dropped 1.2 percent annually in October, slower than September's 1.6 percent decline. Economist had forecast a 1.5 percent drop for October.