Kiwi Flash-Crashes Overnight After ‘Fake’ Tweet Tricks Algos
Turmoil overnight in FX markets as a false tweet by one large financial news reporting site sparked algo-driven chaos for a few brief seconds.
Shortly after the Reserve Bank of New Zealand said it would keep rates on hold Wednesday, Selerity tweeted the following (incorrect) headline (since deleted):
The tweet-reading-algos ran with it – no confirmation required – and dumped kiwi instantly, sending the currency 0.6% lower in a split-second, before reality set in (and stops were run)…
However, since the event, Kiwi is extending its winning run in wake of the RBNZ’s latest policy meeting and accompanying statement that reinforced guidance for lower rates, but was tempered somewhat by a balanced assessment of the economic outlook due to softer property prices vs more expansive fiscal policy.
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