NZ dollar little changed as currency traders await outcome of Greek talks

Friday 26th June 2015

The New Zealand dollar was little changed as currency traders await the outcome of Greek negotiations with its creditors ahead of an International Monetary Fund payment due on Monday, when its current bailout programme expires.

The kiwi was trading at 61.59 euro cents at 8am in Wellington from 61.69 cents at 5pm yesterday. It edged lower to 69.02 US cents at 8am in Wellington, from 69.15 cents at 5pm yesterday after US May consumer spending recorded its largest increase in nearly six years, bolstering optimism about second quarter growth. The trade weighted index was at 72.10 from 72.19 yesterday.

Currency traders are unwilling to take strong positions amid uncertainty about whether Greek debt talks will secure an agreement ahead of Monday's deadline. A meeting of eurozone finance ministers broke up without agreement on Greece, with talks set to resume Saturday morning. German Chancellor Angela Merkel warned that Germany would not be “blackmailed” and in a closed door meeting with her party members in Berlin she stressed a deal had to be done before financial markets opened on Monday.

"With no Greek resolution in sight overnight, most markets remained somewhat in limbo," Bank of New Zealand senior market strategist Kymberly Martin said in a note. "You could draw a straight line through trading in most currencies overnight. Stronger than expected US personal spending data failed to inspire much of a reaction from the US dollar."

BNZ says the kiwi has buyer support at 68.20 US cents and faces resistance at 70 cents.

In New Zealand today, the focus will be on the release of New Zealand trade data for May. The annual deficit is expected to widen to $2.9 billion from $2.6 billion, according to a Reuters poll of economists.

The New Zealand dollar slipped to 89.15 Australian cents from 89.27 cents yesterday, weakened to 43.85 British pence from 44.05 pence and edged lower to 85.32 yen from 85.48 yen.

BusinessDesk.co.nz

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