Kiwi static as traders seek US hint

  • 17/08/2015
Kiwi static as traders seek US hint

By Tina Morrison

The New Zealand dollar was little changed as markets await the release of the US Federal Reserve's minutes on Wednesday for a clue as to whether US interest rates will rise next month.

The kiwi was at 65.32 US cents at 8am in Wellington, from 65.36 cents at the New York close and 65.31 cents at 5pm on Friday. The trade-weighted index was at 70.27 from 70.18 on Friday.

This week, investors will be poring over the minutes from the Federal Open Market Committee's July meeting to gauge whether the US central bank will lift interest rates next month.

Most bets are for the Fed to lift rates in September.

"Expect a quiet start to what is a US dollar-centric week," ANZ Bank said.

"The focus this week remains firmly on (the) US dollar. All the releases this week are expected to support September 'lift-off'."

Investors will also be keeping an eye on the Chinese currency after moves by China's central bank last week to allow the yuan to trade more freely, which led to a sharp decline.

Over the weekend, the chief economist at the People's Bank of China, Ma Jun, noted that in the future, the yuan will probably move in both directions.

In New Zealand, the BNZ-BusinessNZ performance of services index is scheduled for release and traders will be eyeing Tuesday night's GlobalDairyTrade auction as a gain in NZX whole milk powder futures contracts suggests prices may rise.

The New Zealand dollar edged lower to 88.49 Australian cents from 88.58 cents on Friday ahead of Tuesday's release of the Reserve Bank of Australia's minutes from its August meeting.

The local currency weakened to 81.19 yen from 81.24 yen on Friday ahead of the release of second-quarter Japanese gross domestic product.

The kiwi advanced to 58.75 euro cents from 58.54 cents on Friday after second-quarter GDP in the euro area rose 0.3 per cent and it slipped to 41.69 British pence from 41.84 pence on Friday.

NZN