-->
Sharechat Logo

NZ dollar sticks to tight range, eyes on US for direction

Thursday 5th July 2018

Text too small?

The New Zealand dollar stuck to a very tight range against the greenback in Asian trading as markets await key events in the US for direction. 

The kiwi traded at 67.68 US cents as at 5pm in Wellington from  67.61 cents at 8:30am and 67.65 cents late yesterday. The trade-weighted index was at 72.44 from 72.28.

Trading was quiet partly due to the overnight Independence Day holiday in the US but also ahead of minutes from the latest Federal Reserve policy meeting, the imposition of US tariffs on US$50 billion worth of imports from China and non-farm payrolls data in the US Friday. Investors will be watching to see how China responds as fears of a trade war continue to cloud markets. 

"It's really waiting on those things before deciding which way to lurch," said Ross Weston, a senior trader at Kiwibank. Weston, however, said he expects it to remain range bound between 67 US cents and 68 cents until there is a significant driver. He also said the kiwi is finding some support as investors pare back short positions. Going short means betting on a currency to decline and short positions have recently swelled to levels reached only a few times since 2010.  

On the domestic front, Weston said the market is waiting for second-quarter inflation data due later this month, which may be stronger-than-expected would support the kiwi, given the market has priced in a possible rate cut after the latest cash rate review from the central bank.

The kiwi dollar traded at 4.4931 yuan from 4.4821 yuan yesterday and rose to 91.83 Australian cents from to 91.38 cents yesterday. It traded at 74.73 yen from 74.70 yen. It was at 58.06 euro cents from  57.99 euro cents and eased 51.18 British pence from 51.24 pence.

New Zealand’s two-year swap rate fell 1 basis point to 2.13 percent while 10-year swaps were unchanged at 3 percent.

(BusinessDesk)

  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:

PFI doubles 2018 profit on valuation gains, underlying earnings fall short
Steel & Tube turnaround continues with 49% jump in first-half net profit
February 18th Morning Report
FIRST CUT: Port of Tauranga lifts 1H profit 4%
NZ dollar starts the week with a tailwind as positive US-China trade talks boost sentiment
Tax Working Group's capital gains proposal keenly awaited
MARKET CLOSE: NZ shares dip as global trade jitters weigh on A2, F&P
NZ dollar set for weekly gain after Reserve Bank surprise
Burger Fuel exploring sale after review questions listing merits
New net migration data to remain rubbery for quite some time

IRG See IRG research reports