NZ dollar little changed at about 70 US cents as commodities weaken

Tuesday 4th April 2017

The New Zealand dollar was little changed, keeping within the narrow range of the past two weeks, with weaker commodity prices generally weighing on the currencies of commodity-exporting nations.

The kiwi dollar traded at 70.06 US cents as at 8am in Wellington from 70.03 cents late yesterday. The trade-weighted index was at 76.12 from 76.04.

The CRB Index of 19 commonly traded commodities fell 0.7 percent overnight, although the kiwi dollar didn't fall as much as counterparts such as the Australian dollar, which dropped yesterday after weak retail sales data. Traders say reduced volumes on offer at tonight's GlobalDairyTrade auction may see prices rise for the second time in a row but globally, markets are more focused this week on a two-day meeting between US President Donald Trump and his Chinese counterpart Xi Jinping and US non-farm payrolls data at the end of the week.

"Commodity currencies have underperformed, with commodity prices generally lower, although falls have been modest," said Jason Wong, currency strategist at Bank of New Zealand, in a note. The kiwi "is overdue for a recovery, after underperforming across the board during March, undeservedly so in our view."

Today sees the release of the Quarterly Survey of Business Opinion, while the Reserve Bank of Australia is scheduled to release its review of interest rates this afternoon, with no change expected to the 1.5 percent cash rate target.

The kiwi dollar traded at 92.08 Australian cents from 92.02 cents late yesterday. It rose to 65.70 euro cents from 65.56 cents and gained to 56.14 British pence from 55.84 pence. The kiwi slipped to 77.70 yen from 77.97 yen and rose to 4.8244 yuan from 4.8210 yuan.

(BusinessDesk)

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