NZ dollar largely flat on the week ahead of US jobs figures
NZ dollar largely flat on the week ahead of US employment figures
By Paul McBeth
Jan. 10 (BusinessDesk) - The New Zealand dollar is heading for a 0.3 percent dip this week as investors await the release of US employment figures, which are seen as a cue for the Federal Reserve’s view on the pace of scaling back its monetary stimulus.
The kiwi traded at 82.46 US cents at 5pm in Wellington from 82.72 cents at last week’s close, little changed from 82.43 cents at 8am and 82.57 cents yesterday. The trade-weighted index slipped to 78.14 from 78.30 yesterday, and was little changed from 78.30 at last Friday’s close.
A BusinessDesk survey of 11 traders and strategists on Monday predicted the local currency would trade between 81.20 US cents and 84.50 cents this week. Nine expected the currency to rise, one said it would be unchanged and one tipped a decline.
Investors are awaiting non-farm payrolls employment figures on Friday in Washington, and may expect a slightly better number after upbeat private data and lower unemployment claims. The strength of the US labour market is seen as a key plank in the Fed’s plans to unwind quantitative easing, after cutting the monthly bond buying programme by US$10 billion this month to US$75 billion.
“It’s a market that’s pretty thin and waiting for tomorrow morning’s announcement,” said Alex Hill, head of dealing at HiFX in Auckland. “It’s going to need decent variance away from expectations to really do anything” to shift the kiwi out of its recent range, he said.
HiFX’s Hill said the Reserve Bank’s outlook will be key for the kiwi, with the next policy review later this month.
The trans-Tasman currencies largely ignored Chinese trade figures showing an 8.3 percent lift in imports last month. The kiwi fell to 92.63 Australian cents at 5pm in Wellington from 92.90 cents yesterday.
The local currency was little changed at 86.50 yen from 86.55 yen yesterday, and declined to 60.57 euro cents from 60.79 cents. It edged down to 50.04 British pence from 50.17 pence.