Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


NZ dollar little changed before RBNZ interest rate decision

NZ dollar little changed before RBNZ interest rate decision as traders mull outlook

By Tina Morrison

April 24 (BusinessDesk) – The New Zealand dollar was little changed ahead of the Reserve Bank decision on interest rates today as traders await clues to the pace of the tightening cycle.

The kiwi was steady at 85.92 US cents at 8am in Wellington from 85.94 cents at 5pm yesterday. The trade-weighted index was almost unchanged at 79.96 from 79.99 yesterday.

New Zealand’s central bank is expected to hike rates for the second month in a row, taking the benchmark to 3 percent. Last month the RBNZ became the first major central bank to raise interest rates since the global financial crisis, and signalled more hikes were in the pipeline as it attempts to head off inflation. Still, traders are mulling whether the bank may slow the pace of future hikes after a decline in dairy prices and lower than expected inflation.

“Normally an interest rate hike by a central bank is very positive for the currency especially when they are the only ones tightening, but in the case of the RBNZ they could say future rate hikes will be conditional on data, which would suggest a pause in June,” Kathy Lien, managing director of foreign exchange strategy at BK Asset Management in New York, said in a note.

Lien said traders will be focused on any comments on the outlook for future hikes as they mull so-called long bets on the currency, which anticipates a currency will rise in value.

“If the RBNZ were to adopt a less hawkish posture, it would trigger further unwinding of long NZD/USD positions that could take the currency pair to 84 cents even if it remains one of the world’s most hawkish central banks,” Lien said. “If the RBNZ tightens and remains committed to their hawkish monetary policy plans, NZD will soar as traders who sold above 87 cents reload their long positions.”

The central bank will release its decision in a one-page statement at 9am local time.

The New Zealand dollar slipped to 92.51 Australian cents from 92.59 cents yesterday, edged lower to 62.18 euro cents from 62.22 cents, advanced to 51.20 British pence from 51.07 pence and dropped to 88.03 yen from 88.15 yen.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Court Ruling: Kiwifruit NZ Ordered To Consider Collaborative Marketing Proposals

The High Court has told kiwifruit marketer Zespri to reconsider collaborative marketing proposals from Splice Fruit and Seeka Kiwifruit to sell fruit offshore that its board had previously rejected. More>>

ALSO:

Electric Vehicles: No Road User Charges Feature In Govt Package

Drivers of electric vehicles won't have to pay road user charges and will be allowed to drive in bus lanes as part of a new government plan to double EV numbers annually to a target 64,000 by 2021. More>>

ALSO:

Pre-Budget: Computer Emergency Response Team, Assemble!

John Key told the country's first ever Cyber Security Summit in Auckland that the government had earmarked funding set up a national Computer Emergency Response Team to help prevent and act on cyber incidents in partnership with the private sector and other organisations. More>>

ALSO:

Job Cutter Goes: Mark Weldon To Step Down As MediaWorks CEO

“When I joined MediaWorks in August 2014, I had a mandate to lead a significant change programme to bring the business back from receivership into a position where it could once again be a strong competitor in the market, with a sound and sustainable future. It was a big brief, laden with inherent challenges, but I took it in good faith and have dedicated myself fully to the goal since." More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news