Cautious traders keep kiwi unchanged

  • 24/11/2015
Cautious traders keep kiwi unchanged

The New Zealand dollar was little changed as investors await US economic data in a shortened trading week to give them a clearer steer on whether the Federal Reserve will start hiking interest rates next month.

The kiwi traded at 65.24 US cents at 5pm in Wellington from 65.15 cents at 8am and 65.14 cents yesterday. The trade-weighted index was little changed at 71.04 from 71.01.

Economists have revised up their expectations for the pace of growth in the US ahead of its the second estimate for the third quarter, which is scheduled for release on Tuesday in Washington (local time).

The US economy's robustness has stoked expectations the Federal Open Market Committee will end its seven-year run of near-zero interest rates when it reviews policy next month, with traders pricing in a 76 percent chance of a move.

Investors are also keen to see whether the recent decline in global milk product prices will prompt New Zealand's Reserve Bank to cut rates a week before the Fed meeting.

New Zealand's two-year swap rate slipped two basis points to 2.7 percent at 5pm in Wellington, and the 10-year swaps decreased two basis points to 3.58 percent.

The local currency traded at 90.65 Australian cents from 90.69 cents yesterday ahead of a speech from Reserve Bank of Australia governor Glenn Stevens.

The kiwi increased to 4.1674 Chinese yuan from 4.1606 yuan yesterday, and slipped to 90.05 yen from 80.21 yen. It was little changed at 61.34 euro cents from 61.36 cents, and rose to 43.10 British pence from 42.93 pence.