Sharechat Logo

NZ dollar edges up this week as Yellen confirms Fed tapering caution

Friday 15th November 2013

Text too small?

The New Zealand dollar is heading for 0.6 percent gain this week after US Federal Reserve chair nominee Janet Yellen said she doesn't plan on unwinding the central bank's massive stimulus programme while the economic recovery is fragile.

The kiwi rose to 82.91 US cents at 5pm in Wellington from 82.40 cents at the close of trading last week, and is little changed from 82.77 cents at 8am and 82.87 cents yesterday. The trade-weighted index was 77.55 from 77.43 yesterday, almost unchanged on the week.

A BusinessDesk survey of nine traders and strategists on Monday predicted the local currency would trade between 80.80 US cents and 83.80 cents this week. Six expected the currency to remain unchanged while three said it might fall.

The greenback has edged lower this week as investors weigh up Yellen's stance on tapering the Fed's US$85 billion monthly asset purchases, which have been devaluing the world's reserve currency. In her nomination Senate hearing yesterday in Washington, she told policymakers it was important not to remove stimulus "especially when the recovery is fragile and the tools available to monetary policy, should the economy falter, are limited given that short-term interest rates are at zero."

In the US tonight, traders will be eyeing a New York factory survey for November which may show a bounce following the US government partial shutdown last month, and data is also scheduled for release on industrial production for October.

"US data is what we'll all be watching - there's second-tier stuff tonight, and good data will be good for the US dollar and vice versa," said Imre Speizer, market strategist at Westpac Banking Corp. "The kiwi does look a little heavy, and it might break 82 US cents over the week ahead. If that happens then then that takes it down to 79 cents."

The kiwi was little changed at 88.67 Australian cents at 5pm in Wellington from 88.63 cents yesterday, and climbed to 83.09 yen from 82.57 yen. It was little changed at 61.63 euro cents from 61.52 cents yesterday and traded at 51.59 British pence from 51.66 pence.

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: Blue-chip stocks Meridian, A2 lead market lower
NZ dollar rises on Brexit hopes, rate cut reassessment
Three not failing, just needs a new owner - MediaWorks CEO
Major investors back new CBL class action targeting directors
Rip Curl purchase a done deal on Kathmandu proxies alone
Comvita chair Neil Craig eyes the exit once he finds a new CEO
Mercury raises guidance on increased storage, high spot prices
Eroad reports strong 3Q sales growth, eyes ASX listing
MediaWorks puts TV business on the block
NZ dollar benefits as preliminary Brexit deal improves risk appetite

IRG See IRG research reports