NZ dollar little changed in local trading
By Paul McBeth
The New Zealand dollar was little changed in local trading ahead of the GlobalDairyTrade auction, which is expected to show the rebound in dairy prices has run out of steam for now.
The kiwi traded at 68.05 US cents at 5pm in Wellington from 67.98 cents at 8am and 67.97 cents yesterday. The trade-weighted index increased to 72.95 from 72.72 yesterday.
Fonterra's GDT auction will be held in the US today, with milk price futures predicting little movement in dairy prices after gains in the last four events.
The recent rally in dairy prices helped allay fears about New Zealand's economy, after a slump in prices through most of the year forced milk exporters to slash their payouts to farmers, crimping their incomes for the current season and weighing on the outlook for the rural sector.
The auction comes as traders await interest rate decisions by the US Federal Reserve and Reserve Bank of New Zealand next week.
Neither central bank is expected to move, although they are in different cycles, with the Fed having indicated it plans to start raising rates, while the RBNZ says it's still in an easing cycle.
New Zealand's two-year swap rate rose two basis points to 2.73 percent at 5pm in Wellington, while 10-year swaps gained four basis points to 3.51 percent.
The kiwi advanced to 93.68 Australian cents from 93.43 cents yesterday.
The local currency rose to a four-and-a-half month high, trading at 88.78 Canadian cents from 87.81 cents yesterday after Canada's three major broadcasters projected Justin Trudeau's Liberal Party was set to win the national election, ending the decade-long rule of Conservative Prime Minister Stephen Harper.
The kiwi increased to 4.3279 Chinese yuan from 4.3229 yuan yesterday, and edged up to 81.31 yen from 81.16 yen. It rose to 60.04 euro cents from 59.81 cents, and was little changed at 43.97 British pence from 44.01 pence.