US employment report awaited to drive global currency sentiment
By Paul McBeth
May 2 (BusinessDesk) - The New Zealand dollar was little changed ahead of US employment data after figures earlier this week showed the world’s biggest economy barely grew in the first three months of the year.
The kiwi traded at 86.27 US cents at 5pm in Wellington from 86.36 cents at 8am, and 86.13 cents yesterday. The trade-weighted index increased to 80.20 from 80.01 yesterday.
Investors are expecting strong jobs growth when US non-farm payrolls for April are released overnight, with a Bloomberg survey predicting a monthly lift of 218,000, a strong lift at odds with an unexpected lift in unemployment benefit claims last month.
“There’s nothing that anyone cares about to take us out of recent ranges ahead of non-farms,” said Nick Tvedt, senior corporate FX dealer at HiFX in Auckland, referring to tonight’s US jobs report.
He expects the kiwi will trade between 86 US cents and 86.40 cents, with upward bias, since weak US economic growth figures released on Wednesday in the US continue to confound predictions.
“Sitting in the wake of Wednesday, you’d need to see something pretty surprising to reverse all of that,” Tvedt said.
The local currency is heading for a 0.6 percent gain against the greenback, and is largely flat on a trade-weighted basis, over the week.
New Zealand commodity prices fell 4 percent last month, led by declines in the price of dairy products, according to an ANZ survey.
The kiwi rose to 88.32 yen at 5pm in Wellington from 88.06 yen yesterday, and climbed to 92.99 Australian cents from 92.67 cents. It increased to 62.25 euro cents from 62.07 cents yesterday, and edged up to 51.10 British pence from 51.02 pence.