NZ dollar falls vs. A$ after RBA minutes show bank happier with currency
By Paul McBeth
Feb. 18 (BusinessDesk) - The New Zealand dollar fell against its trans-Tasman counterpart after minutes to this month's Reserve Bank of Australia meeting showed the regulator was more comfortable with the level of the nation's currency.
The kiwi fell to 92.09 Australian cents at 5pm in Wellington from 92.51 cents at 8am and 92.44 cents yesterday. It traded at 83.46 US cents at 5pm from 83.59 cents at 8am, down from 83.72 cents yesterday.
The RBA board noted the Australian dollar's depreciation in recent months, while other major currencies were largely unchanged, according to the minutes to Feb. 4 meeting when the bank kept the key rate unchanged, while dropping its bias for further cuts. Australian central bank officials have been bemoaning the strength of the nation's currency as tripping up a stalling economy. The Australian dollar climbed to 90.61 US cents from 90.33 cents before the release.
"The RBA is not going to try and nudge the currency down any lower, and if they're not going to push the currency down any lower, then punters can push it up," said Imre Speizer, market strategist at Westpac Banking Corp. The RBA minutes made speculative investors more upbeat about the Australian dollar, "and that's why the kiwi has been belted."
US markets were closed yesterday for Presidents' Day holiday and investors will be watching manufacturing and housing figures today after some weaker than expected data in recent weeks due to the extreme winter in the world's biggest economy.
The kiwi rose to 85.42 yen from 85.03 yen yesterday after the Bank of Japan continued its commitment to double its monetary base in a bid to lift inflation to 2 percent, and doubled its lending facility for financial institutions to stimulate credit growth.
The local currency fell to 60.87 euro cents at 5pm in Wellington from 61.08 cents yesterday, and was little changed at 49.89 British pence from 49.85 pence. The trade-weighted index declined to 78.25 from 78.40 yesterday.