Sharechat Logo

NZ dollar benefits from Trump press conference to remain at month highs

Thursday 12th January 2017

Text too small?

The New Zealand dollar continued to hover at its highest level since mid-December against the greenback Thursday, as traders pushed down the value of the US currency following President-elect Trump's press conference. 

The local currency was trading at 70.77 US cents at 5 pm in Wellington, from 70.60 US cents at 8 am and 69.97 US cents twenty-four hours ago. The trade-weighted index rose to 77.90 from 77.45 this time yesterday

The US dollar came under pressure early in the Asian session after US president-elect Donald Trump offered few details on infrastructure and tax reform in his hour-long press conference. Instead, he chose to focus on reports of Russian interference in last year's US presidential election.

The conference was disappointing and weighed on the greenback even though Trump didn’t say anything negative about the US dollar, said ASB head of FX institutional sales New Zealand Tim Kelleher.

“The market has been very bearish in US bonds and extremely bullish on the US dollar and we are just seeing some unwinding of that,” he said. The weaker greenback in Asia, particularly against the Japanese yen, is helping shore up both the Aussie and the Kiwi, he said.  Events in the US are likely to remain the main driver of the kiwi into the foreseeable future but “I don’t think we are going anywhere fast.”

The “big line in the sand” for a solid push downwards is still 68.50, said Kelleher. Investors will be watching for tomorrow’s electronic card spending data for further evidence of strong consumer demand.

Following a 2 percent fall in the value of the kiwi against the Australian cents since Jan 3, the kiwi was broadly flat in trading today, trading at 94.79 Australian cents from 94.77 Australian cents yesterday. It gained against the British pound, trading at 57.94 pence from 57.46 pence yesterday,

Against the Chinese yuan, the kiwi rose to 4.8896 yuan from to 4.8432 yuan twenty-four hours ago. It dropped against the Japanese yen, to 80.99 yen from 81.12 yen. It was trading at 66.70 against the Euro versus 66.30 euro cents. 

New Zealand's two-year swap rate eased down 3 basis points at 2.32, while the 10-year swap rate was down 5 basis points at 3.33.

  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:

MARKET CLOSE: NZ shares up 1%, led by Fisher & Paykel, Kathmandu, Spark
NZ dollar heads for 2% decline as resurgent US yields stoke greenback demand
Former Abano shareholders ordered to pay $429k in disputed takeover costs
Seeka shareholder Farmind to cut stake to reduce foreign ownership
Summerset opens Melbourne office as it looks to Australia for growth
Lees-Galloway signals broader health & safety targets in draft strategy
Veritas in refinancing negotiations as ANZ extends debt for a fourth time
ComCom embarks on fibre study to get a handle on looming new policy framework
NZ posts first trade deficit for March month in 10 years as fuel imports surge
NZ log export market picks up after slowdown ahead of Chinese New Year, traders optimistic

IRG See IRG research reports