New Zealand dollar advanced against US peer with a limited pace

New Zealand dollar gained against its US counterpart on Wednesday, but upward movement was expected to be limited amid prospects that the Federal Reserve Bank will keep Quantitative Easing.

NZD/USD hit 0.7780 at 7:34 GMT, currently the session high. The pair added 0.46% for the day. Support was expected at June 24th low, 0.7684, while resistance was to be encountered at June 21st high, 0.7807.

US Department of Commerce reported on Tuesday, that Durable Goods Orders in the United States rose by 3.6% in May, exceeding forecasts of a 3.0% increase rate, and confirming the rate, registered during April.

A separate report showed, that S&P/Case-Shiller Composite-20 Home Price Index in US registered a 12.05% jump in April on annual basis, as this was the sharpest rate of increase since the beginning of statistical research and above expectations of a 10.60% increase.

Additionally, New Home Sales in the United States registered their highest level in May for the past five years, climbing by 2.1% in May to reach the annual 0.476 million units.

Last but not least, it became clear that US Consumer Confidence increased to the highest level since January 2008 in June, reaching the reading of 81.4, far above expectations of a value at 75.0.

Fed Chairman Ben Bernanke said on June 19th, that the central bank could begin tapering bond purchases by the end of 2013, in case US economic indicators continued to show improvement.

Meanwhile, fears over a credit contraction in China were eased, after the country’s central bank made clear on Tuesday that it was acting in order to boost financial institutions with liquidity. According to statement on Chinese central banks website, it provided certain institutions with liquidity in order exchange rates on the money market to be stabilized. The bank will use short-term pro-liquidity operations and constant credit instruments, thus encouraging commercial banks in the country to bolster their liquidity management. The chief economist at Beijing based Everbright Securities Co. supported Chinese central banks acts, saying that its goal was to ease market nervousness.

Later in the trading day the United States will announce revised data, regarding economic growth during the first three months of this year.