NZ dollar falls vs yen as North Korea tensions stoke demand for safe havens

Tuesday 5th September 2017

The New Zealand dollar fell against the yen as ongoing tensions over North Korea stoked demand for safe haven assets although trading was subdued following the US Labor Day holiday on Monday.

The kiwi fell to 78.54 yen as at 8am in Wellington from 78.76 yen late yesterday. It traded at 71.65 US cents from 71.73 cents yesterday.

The yen and gold have both gained since tensions over North Korea revived over the weekend following its sixth nuclear test. Nikki Haley, the US ambassador to the UN, told the Security Council that North Korean leader Kim Jong Un was "begging for war" while South Korea is reportedly installing more missile defense batteries.

"With little economic data to trade on, the focus has been on North Korea’s provocations, which have seen a modest shift into safe-haven assets," said Jason Wong, currency strategist at Bank of New Zealand.

In New Zealand today, traders will be watching for building work put in place for the second quarter while the latest GlobalDairyTrade auction is scheduled for tonight. Across the Tasman, the Reserve Bank of Australia releases its review of interest rates and governor Philip Lowe is scheduled to give a speech tonight. Before that, Australian government figures for the balance of payments in the second quarter are to be released.

The trade-weighted index was at 74.65 from 75.03 late yesterday.

The New Zealand dollar rose to 90.18 Australian cents from 90.08 cents. It declined to 60.22 euro cents from 60.36 cents and was at 55.41 British pence from 55.37 pence. The kiwi traded at 4.6759 yuan from 4.6975 yuan.

(BusinessDesk)

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