Sharechat Logo

NZ dollar steady as markets await Fed statement

Tuesday 30th April 2019

Text too small?

The New Zealand dollar is steady as markets await the US Federal Reserve's monetary policy decision and statement later this week. Local business confidence data today will garner interest. 

The kiwi was trading at 66.70 US cents at 7:50am in Wellington from 66.79 US cents at 5pm. The trade-weighted index was at 72.71 points from 72.82.

Investors are largely on the sidelines ahead of the Federal Reserve's latest monetary policy decision on Thursday morning New Zealand time. While the Fed is expected to keep rates unchanged, the statement and press conference will be closely watched for any clues on its direction as it looks to balance strong economic growth with still tepid inflation.

In recent weeks Fed officials have said they will be "patient," which has led some economists to think rates could be on hold into 2020. 

"We expect no change in the FOMC’s interest rates guidance," said ANZ FX/rates strategist Sandeep Parekh. "Inflation is below target and despite still-strong headline growth and robust momentum in the labour market, a sustained acceleration in core inflation remains elusive." 

In overnight data, the US core Personal Consumption Expenditure Price Index rose 1.6 percent on a yearly basis in March, falling short of the market expectation of 1.7 percent and moving further away from the Fed's 2 percent inflation target.

Domestically, investors will be watching today's ANZ business outlook survey to see if the mood among New Zealand firms continues to sour. However, the main domestic data this week is Wednesday's jobs data. Economists are expecting the March-quarter unemployment rate to be 4.2 percent according to the median of economists polled by Bloomberg. Wage inflation is expected to remain tepid. 

Both pieces of data will feed into expectations of what the central bank might do at its May 8 meeting, in particular after RBNZ governor Adrian Orr said the next move is likely to be a rate cut at the March monetary policy review. 

The New Zealand dollar was trading at 94.46 Australian cents from 94.85. It was at 51.54 British pence from 51.63, at 59.60 euro cents from 59.85, at 74.45 Japanese yen from 74.53 and at 4.4897 Chinese yuan from 4.4938.


Bond Offer: Infratil Ltd, 7.2 year & 10.2 year unsecured unsubordinated bond

  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

NZ dollar sags after avalanche of data and central bank action
Fonterra board starts planning chair succession
Fulton Hogan keeps Australian civil construction unit
Time for congestion pricing has come - NZIER
Colliers defends KiwiBuild as 'far from a colossal failure'
Pushpay shares rise as cost-cutting upgrades earnings guidance
20th September 2019 Morning Report
NZ dollar weaker against British pound on EC president's Brexit optimism
Todd plans Kapuni drilling campaign
MARKET CLOSE: NZ shares gain; appetite for KFC helps Restaurant Brands hit record

IRG See IRG research reports