A coalition led by the Labour Party in New Zealand has taken control of the government, and currency traders are punishing the country by selling off the New Zealand dollar. James Glynn writes:
Despite finishing second in an inconclusive general election, 37-year-old Labour leader Jacinda Ardern emerged victorious after smaller parties agreed Thursday to form a government. The coalition ends nearly a decade of conservative rule that helped propel the island economy to one of the fastest growth rates in the developed world.
The uncertainty created by the prospect of a switch in policies and the likelihood that the new government will favor a weaker currency sparked a fall of about 2.8% in the kiwi dollar against the U.S. dollar between lunchtimes on Thursday and Friday, pushing the currency below 70 U.S. cents for the first time since May.
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