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Upbeat US data, rising bond yields support greenback

NZ dollar retreats as upbeat US data, rising bond yields support greenback

By Jonathan Underhill

May 18 (BusinessDesk) - The New Zealand dollar fell, giving up modest gains seen in the wake of yesterday's Budget, as an upbeat indicator of US manufacturing and rising Treasury yields helped underpin the greenback.

The kiwi dollar fell to 68.73 US cents as at 8am in Wellington from 69.05 cents late yesterday. The trade-weighted index slipped to 72.13 from 72.30 yesterday.

The yield on US 10-year Treasuries is about 3.12 percent, the highest since July 2011 and helping enhance the appeal of the US dollar. The Philadelphia Fed manufacturing index jumped to 34.4 in May from 23.3 in April, the highest reading in a year, while the new orders measure rose to a 45-year high. Traders appear to have taken New Zealand's Budget in their stride, with Finance Minister Grant Robertson outlining plans to maintain fiscal discipline while making a start on the coalition's policy spending plans.

The Philly Fed index

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