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NZ dollar little changed in subdued Independence Day trading as Fed minutes, payrolls loom

Thursday 5th July 2018

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The New Zealand dollar was little changed in subdued trading in the face of the July 4 Independence Day holiday in the US ahead of the release of the Federal Reserve minutes and US employment figures.

The kiwi dollar traded at 67.61 US cents as at 8:30am in Wellington from 67.65 cents late yesterday. The trade-weighted index was little changed at 72.28.

With no domestic economic data scheduled today, traders are likely to look ahead to the June ADP private employment report, ISM non-manufacturing index for June and the minutes of the last Fed policy meeting tonight, followed by non-farm payrolls on Friday. The US dollar index reached an 11-month high last month but has since retreated as traders ponder the ramifications of increased trade tensions and US President Donald Trump's reported plans to prevent US trade policy being influenced by the World Trade Organisation.

"The US Independence Day holiday has meant quiet trading conditions and small movements in asset prices," said Jason Wong, senior markets strategist at Bank of New Zealand, in a note. "Should be quiet trading during the local session, ahead of US ADP employment and the non-manufacturing ISM releases tonight, followed by minutes of the last Fed meeting."

The kiwi dollar traded at 4.4812 yuan from 4.4821 yuan yesterday, having reached a two-month high against the Chinese currency last week. Reuters reported overnight that Beijing was comfortable with a weaker yuan and would only intervene to prevent any rapid decline or to cope with any fallout from a trade war with the US.

It rose to 91.51 Australian cents from to 91.38 cents yesterday and traded at 74.68 yen from 74.70 yen. It was little changed at 57.99 euro cents and fell to 51.08 British pence from 51.24 pence.

(BusinessDesk)

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