Dollar edges up as central bank meetings loom, emerging markets calmer

Free audio stream, including stories that are padlocked on our site. Listen on any device, anywhere. Updated twice daily. The audio stream takes several seconds to start on Android devices.

Launch Radio player

The New Zealand dollar rose as fears over emerging markets fell, fuelling demand for risk-sensitive assets such as the kiwi, and ahead of the Reserve Bank of New Zealand and US Federal Reserve policy reviews tomorrow.

The kiwi increased to 82.81 US cents at 5pm in Wellington from 82.59 cents at 8am and 82.75 cents yesterday. The trade-weighted index rose to 78.37 from 78.20 yesterday.

Global stock markets rallied and investors returned to riskier assets after fears over some developing economies subsided, with Turkey's central bank hiking interest rates to quell a sell-off of Turkish lira.

That comes ahead of the Federal Open Market Committee meeting, which is expected to see the Fed trim another US$10 billion from its US$75 billion monthly asset purchase programme, and New Zealand's central bank meeting, which has divided markets on whether governor Graeme Wheeler will raise interest rates at this review or the next.

"Only if we get a hike will it be good for the kiwi," said Imre Speizer, market strategist at Westpac Banking Corp in Auckland. "The signal to March (for a rate hike) might pull the kiwi back a bit, and no signal will see it fall sharply."

Westpac's Speizer said the local currency may test the upside of its recent range between 82.20 US cents and 83 cents on the upbeat sentiment.

New Zealand's economy and the government's books got the seal of approval from Moody's Investors Service today, with the rating agency saying both were improving after a prolonged, albeit mild, recession and the spate of earthquakes in 2010 and 2011. New Zealand is rated 'Aaa' by Moody's.

The New Zealand dollar was unchanged from 94.06 Australian cents yesterday, and gained to 85.46 yen from 84.93 yen. It edged up to 60.66 euro cents from 60.48 cents, and increased to 49.95 British pence from 49.79 pence yesterday.

(BusinessDesk)


Got a question about this story? Leave it in Comments & Questions below.

This article is tagged with the following keywords. Find out more about MyNBR Tags

Comments & Questions

Commenter icon key: Subscriber Verified

Post New comment or question

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.

NZ Market Snapshot

Forex

Sym Price Change
USD 0.7302 0.0001 0.01%
AUD 0.9335 -0.0010 -0.11%
EUR 0.6649 0.0006 0.09%
GBP 0.4718 0.0000 0.00%
HKD 5.6604 0.0015 0.03%
JPY 88.8350 0.0850 0.10%

Commods

Commodity Price Change Time
Gold Index 1204.0 -0.520 2015-05-22T00:
Oil Brent 65.9 1.310 2015-05-22T00:
Oil Nymex 59.7 -1.040 2015-05-22T00:
Silver Index 17.0 -0.081 2015-05-22T00:

Indices

Symbol Open High Last %
NZX 50 5769.3 5785.2 5769.3 0.12%
NASDAQ 5085.4 5103.8 5090.8 -0.03%
DAX 11881.5 11881.8 11864.6 -0.42%
DJI 18286.9 18286.9 18285.7 -0.29%
FTSE 7013.5 7061.7 7013.5 0.26%
HKSE 27723.7 28041.3 27523.7 1.70%
NI225 20331.9 20409.0 20264.4 0.70%