Monday 27th November 2017
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The New Zealand dollar fell to the lowest in more than a week versus the euro on evidence Germany's economy is rebounding while that country makes progress on forming a coalition government.
The kiwi fell to 57.58 euro cents as at 8:30am in Wellington from 57.66 cents on Friday in Europe and from 58.03 cents in Asia at the end of last week. It was little changed at 68.75 US cents from 68.64 cents. The trade-weighted index was at 72.50 from 72.47.
The US dollar index weakened into the end of last week as the euro gained after Germany's IFO measure of business confidence rose to a record in November, beating estimates and adding to recent strong data from the eurozone's biggest economy. Trading was relatively subdued with the US Thanksgiving Holiday and there is little economic news on the calendar for today. Meanwhile, German Chancellor Angela Merkel looks more likely to be able to form a coalition after the main opposition party indicated it may provide support.
"The continued trend of new highs in surveyed activity data indicates firming growth across the (euro) region," said Con Williams, rural economist at ANZ Bank New Zealand.
The kiwi dollar traded at 4.5374 yuan from 4.5400 yuan. China has announced cuts to tariffs on imports, which Williams said may provide a boost for New Zealand products including infant formula, seafood, avocados and processed foods. Still, Williams said, it was "not immediately easy to see how this reconciles with our existing market access and exports. In many cases it could just bring the competition closer."
Looking ahead this week, traders will be watching for Federal Reserve Chair Janet Yellen's testimony to Congress on the US economic outlook on Wednesday, a day after Jerome Powell, nominated to succeed her in February, will appear in confirmation hearings before the Senate. The Fed also releases its Beige Book on Wednesday
A host of US economic data slated for release this week include reports on new home sales and Dallas Fed manufacturing survey, today; international trade in goods, FHFA house and S&P Corelogic Case-Shiller price indices, consumer confidence, and Richmond Fed manufacturing index, due Tuesday; gross domestic product, corporate profits, and pending home sales index, due Wednesday; weekly jobless claims, personal income and outlays, Chicago PMI, and farm prices, due Thursday; and motor vehicle sales, PMI and ISM manufacturing indices, due Friday.
Also on the radar is a meeting of the Organisation of the Petroleum Exporting Countries (OPEC) on Nov. 30, which may see production curbs extended.
The kiwi dollar traded at 90.15 Australian cents from 90.31 cents and at 51.52 British pence from 51.55 pence. It traded at 76.60 yen from 76.70 yen.
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