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

 

US payrolls increase odds of interest rate cuts

NZD stronger as weak US payrolls increase odds of interest rate cuts


By Rebecca Howard

June 10 (BusinessDesk) - The New Zealand dollar held its gains after weaker-than-expected US jobs data increased speculation the Federal Reserve will move to lower interest rates there.

The kiwi was trading at 66.61 US cents at 7:55am versus 66.64 US cents late Friday in New York and 66.16 US cents at 5pm Friday in Wellington. The trade-weighted index was at 72.96 from 73.00 late Friday in New York.

The US Bureau of Labor report showed a small 75,000 gain in non-farm payrolls and downward revisions to previous months’ figures. Economists had expected a 180,000 increase.

"While the unemployment rate stayed at 3.6 percent, and wage growth was solid, the release nonetheless supports our view that the US economy is losing momentum," said Capital Economics.

While it expects Fed officials will want to see evidence of more sustained weakness before taking action "we are increasingly convinced that the Fed will begin cutting interest rates later this year."

The New Zealand dollar "led by example, rallying strongly after disappointing US payrolls data added more credence to Fed cuts," said ANZ Bank FX/rates strategist Sandeep Parekh. This week's US CPI data - due mid-week - will be key.

The kiwi also got a lift on improving risk appetite after the US reached a deal with Mexico late Friday and suspended the threat of tariffs. Jitters around US-China trade tensions remain and China's May trade data will be a key driver today.

The New Zealand dollar was trading at 94.95 Australian cents from 95.16, at 52.32 British pence from 52.44, at 58.85 euro cents from 58.79, at 72.31 yen from 72.10 yen and at 4.5985 Chinese yuan from 4.6020.

(BusinessDesk)

ends

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Seeking 'Clarity': Crown To Appeal Southern Response Decision, Offers Costs

“It is our intention that the clarity that will come from the outcome of these proceedings will enable the Crown to work with Southern Response to provide a soundly based proactive solution to those people that are affected.” More>>

Thinking Of The Children: Plan For Classification For Commercial Video On Demand

Classifying on-demand video content will be made mandatory to bring it in line with other media and provide better guidance and protections to families and young people, says Internal Affairs Minister Tracey Martin. More>>

Cheques Out: Inland Revenue And ACC Push For Paperless

Inland Revenue and the Accident Compensation Corporation are calling ‘time’ on cheques. From March next year, IR and ACC will no longer accept payments by cheque from customers who are able to use alternative payment options. More>>

ALSO:

"Vision And Growth": Capital Markets 2029 Report

Broader participation by New Zealanders, greater access to growth capital for New Zealand enterprises, and more choices for investors drive the recommendations in the Capital Markets 2029 report released today. More>>

ALSO:

Forest & Bird: Call For More Funding To Stop Plague Of Wallabies

Wallabies could spread over a third of New Zealand within the next 50 years, unless control is increased dramatically, says Forest & Bird central North Island regional manager Rebecca Stirnemann. More>>

ALSO: