Sharechat Logo

NZ dollar falls as markets await Euro deal

Thursday 29th September 2011

Text too small?

New Zealand dollar fell against the greenback, following equity markets lower as lack of news out of Europe sapped some of the some of the optimism seen earlier this week when investors thought policymakers would expand the European bailout fund.

The kiwi dollar recently traded at 77.83 U.S. cents, down from 78.45 cents yesterday, and fell to 69.06 on the trade-weighted index of major trading partners' currencies from 69.52 previously.

The lack of further concrete steps on expanding the scope of the European Financial Stability Fund by allowing it to borrow from the European Central bank, a key step in the eyes of many investors, saw global share markets unable to sustain yesterday's rally. On Wall Street, the Standard * Poor's 500 Index fell 0.6% to 1,167.80, and Europe's Stoxx 600 Index fell 1.1% to 227.39.

Risk appetite were further dented as inspectors from the ECB and International Monetary Fund arrive in Greece to assess where policymakers had passed sufficient austerity measures to secure the release of the next 8 billion euro bailout payment needed to pay creditors and keep the government running through October.

"We saw a big rally in risk currencies in the previous session, and we've now given back half of that," said Khoon Goh, head of market economics and strategy at ANZ New Zealand. "We're in the phase now where the market is waiting for concrete news and in the interim there is a void and a lot of price action is noise to be fair."

On the crosses, the kiwi recently traded at 79.32 Australian cents, down from 79.38 cents yesterday, and fell to 59.49 Japanese yen from 60.01 yen previously. It dropped to 57.34 euro cents from 57.79 cents yesterday, and declined to 49.87 pence from 50.16 pence previously.

Data out of the U.S. came in better than expected, with new orders for long-lasting U.S. manufacture red goods falling by less than anticipated in August, while a rebound in a gauge of business spending supported views the economy would likely avoid another recession.

The kiwi may trade between a range of 77.20 U.S. cents and 78.50 cents, Goh said, and is likely to trade in a volatile range ahead of more details on Europe.


  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 gains on G20 preference for growth
NZ dollar dips as Wellington CBD checked for quake damage
NZ dollar gains, bolstered by RBA minutes, strong dairy prices
NZ dollar falls after central bank says it may scale up currency intervention
NZ dollar gains before CPI, helped by dairy gains, rally on Wall Street
NZ dollar trades little changed as US budget talks bear down on deadline
NZ dollar falls with equities on view US to sail over fiscal cliff
NZ dollar weakens as fiscal cliff looms, long bets unwind
NZ dollar sinks to three-week low as equities fall, fiscal talks in focus
NZ dollar slips as fiscal cliff talks grind slower in Washington