NZ dollar heads for 0.9% weekly decline
NZ dollar heads for 0.9% weekly decline as US jobs data looms
By Paul McBeth
March 6 (BusinessDesk) -
The New Zealand dollar is heading for a 0.9 percent weekly
decline ahead of US employment figures, which will provide a
gauge on the strength of the world's biggest economy and
give the greenback its next cue for a direction.
The
kiwi fell to 74.95 US cents at 5pm in Wellington from 75.60
cents on Friday in New York last week. It traded at 74.60 US
cents at 8am and 75.50 cents yesterday. The trade-weighted
index fell to 78.14 from 78.66 yesterday, and is heading for
a 0.3 percent weekly decline.
A BusinessDesk survey of
12 currency traders and strategists predicted the kiwi would
trade between 74.20 US cents and 77.60 cents this week. Five
expected the currency to gain, while five said it would
decline and two bet it would remain relatively
unchanged.
Investors are waiting for US non-farm
payrolls figures for February, which are expected to show
the world's biggest economy added 235,000 jobs that month.
While the pace of new job creation will be lower than in
January, analysts expect to see a pick-up in wages, which
would be seen as a positive for the US
economy.
"Everybody's just waiting for payrolls, and the US dollar has been on the back foot ahead of it," said Sam Tuck, senior FX strategist at ANZ Bank New Zealand in Auckland. "The kiwi is just flotsam and jetsam on US dollar flows and is still really within the range."
The local
currency was pushed lower after New Zealand's Reserve Bank
signalled plans to impose higher capital requirements for
lending on residential property investment, which traders
saw as potentially opening the path to lower interest rates.
Traders are pricing in a 4 percent chance of a rate cut at
next week's monetary policy meeting, and predict the 3.5
percent official cash rate will be 19 basis points lower
over the coming 12 months, according to the Overnight Index
Swap curve.
New Zealand's two-year swap rate fell to
3.535 at 5pm in Wellington from 3.55 yesterday, while the
10-year swap rate increased to 3.825 from 3.815.
Moody's Investors Service today said New Zealand's economy is expected to grow almost 3 percent this year, with increased building activity offsetting declines in dairy prices. Separately, government figures today showed wholesale trade rose 0.3 percent in the December quarter.
The kiwi
dollar dropped to 4.6956 Chinese yuan at 5pm in Wellington
from 4.7325 yuan yesterday, and declined to 96 Australian
cents from 96.51 cents yesterday. It fell to 67.97 euro
cents from 68.21 cents yesterday, and decreased to 49.19
British pence from 49.49 pence. The kiwi slipped to 89.93
yen from 90.43 yen
yesterday.
(BusinessDesk)