Sharechat Logo

NZ dollar gains as US inflation data stokes reflation talk, prospect of rate hikes

Thursday 16th February 2017

Text too small?

The New Zealand dollar rose after stronger-than-expected US inflation figures stoked talk of global 'reflation' which will hasten central bank moves to tighten monetary policy.

The kiwi advanced to 72.08 US cents as at 8am in Wellington from 71.73 cents late yesterday. The trade-weighted index rose to 78.49 from 78.11.

The US consumers price index rose 2.5 percent in the 12 months through January, the biggest year-on-year gain since March 2012, and faster than economists were expecting. Other figures showed retail sales rose 0.4 percent last month, four times faster than expected. US stocks rose and bond yields gained after the data.

"Ultimately the pressure for higher rates is expected to remain in the face of the global reflation trade and signs that the NZ economy is going down a similar path," said Jason Wong, currency strategist at Bank of New Zealand, in a note. "The global reflation trade continued on the release of strong US CPI and retail sales data."

Traders will be watching for the ANZ consumer confidence report for February, a speech by Finance Minister Steven Joyce and the Crown accounts for the six months ended Dec. 31 today.

The kiwi rose to 57.88 British pence from 57.52 pence and gained to 68.07 euro cents from 67.74 cents. It rose to 93.60 Australian cents from 93.42 cents and gained to 82.33 yen from 81.96 yen. The kiwi rose to 4.9494 yuan from 4.9233 yuan.

BusinessDesk.co.nz

  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comment:
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:

MARKET CLOSE: NZ shares gain as A2 calms critics with strong sales
NZ dollar may extend rally on signs of gradual Fed rate increases
Larry Ellison's NZ yacht company key to America's Cup rival
Port of Tauranga eyes record $101mln 2019 profit on cargo growth
Marsden Maritime eyes benefits from upper North Island transport study
NZ screen sector needs special employment carve-outs to stay competitive
A2 shares climb 7.7% as Chinese formula sales grow
NZ software firm SwipedOn sells for $11 million
AWF Madison drops 3.7% as failed construction firms dent earnings
Genesis partners with Tilt in Taranaki wind farm

IRG See IRG research reports