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NZD below 67 US cents after US data lifts greenback

Tuesday 23rd April 2019

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The New Zealand dollar remained under pressure after taking a tumble on strong US data late last week ahead of the four-day Easter holiday weekend.

The kiwi was trading at 66.75 US cents at 8am in Wellington versus 66.65 late yesterday in New York and 67.16 US cents at 5pm Thursday in Wellington. The trade-weighted index was at 72.44, unchanged from late yesterday and down from 72.69 Thursday in Wellington. 

The US dollar was helped by stronger-than-expected US retail sales for March as well as data showing the number of Americans filing applications for unemployment benefits dropped sharply. 

"The bulk of the move occurred on Thursday night and it was a US dollar strength story rather than a specific kiwi weakness story after some pretty solid US data helped the greenback," said Mike Shirley, foreign exchange dealer at Kiwibank.

With very little domestic data on the near horizon, the kiwi will continue to get pushed around by offshore headlines. Stuart Ive, private client manager at OMF, said the main event this week will be US gross domestic product data Friday, with analysts now expecting a stronger number after the trade balance narrowed more than expected. 

"A strong economy and a Fed unlikely to raise rates – while NZ and AU expectations are for cuts - leaves the kiwi under pressure for now," he said. 

The New Zealand dollar was trading at 93.57 Australian cents versus 94.40 late yesterday in New York, at 51.43 British pence from 51.37, at 59.29 euro cents from 59.37, at 74.72 Japanese yen from 74.71 and at 4.4804 Chinese yuan from 4.4751.

(BusinessDesk)

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