NZD falls hard on Fonterra tainted milk scare

The dairy industry is very important to New Zealand and Fonterra is their biggest dairy exporter. News broke yesterday that some of their milk powder products are contaminated with a dangerous strain of bacteria and this has caused some countries like Russia to put a ban on imports.

NZD/USD fell by nearly 2% in early interbank trade to level below 77 cents, after closing in NY near .7850. AUD/NZD has jumped to 1.1500 and resistance should be very solid here; so if you managed to pick the 1.12 bottom, booking partial profits looks like a decent idea.

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