The New Zealand dollar was little changed as investors seeking to benefit from the carry trade favoured the Australian dollar over its New Zealand counterpart, amid expectations US monetary stimulus will last longer than anticipated.
The kiwi was at 84.81 US cents at 8am in Wellington, little changed from 84.87 cents at the New York close Friday and up from 84.60 cents at the 5pm market close in Wellington. The kiwi slipped to 87.68 Australian cents from 87.86 cents on Friday.
The US dollar index, which measures the greenback against a basket of currencies, declined on expectations the Federal Reserve will delay tapering its monetary stimulus programme following this month's government shutdown. Investors borrowing in low-interest-rate currencies to buy higher-yielding assets are betting the Australian dollar, which has gained 4.5 percent the past three months, has higher to go, compared with the kiwi which has increased 6.5 percent in the same period.
"Currency markets continued to push back tapering expectations, weakening the US dollar," Sharon Zollner, senior economist at ANZ New Zealand, said in a note. "The carry story should benefit the Australian dollar more than the New Zealand dollar."
Traders are expecting a slew of economic data to be released in the US this week as government offices re-open following a two-week shutdown.
In New Zealand today, data on net migration for September is scheduled for release at 10:45am while September credit card spending is due at 3pm.
The New Zealand dollar was little changed against other major currencies, at 82.87 yen from 82.90 yen on Friday, 52.42 British pence from 52.37 pence and at 61.97 euro cents from 61.89 cents. The trade-weighted index edged up to 78.12 from 78 on Friday.
This article is tagged with the following keywords. Find out more about MyNBR Tags
- Serco's prison report challenge: Hide and Davis go head-to-head
- Tech expert's complaint about 'snake oil' ad upheld
- iPredict closing down due to money laundering risk
- Xero directors Drury, Winkler and Morgan cash in on 35% share price rally
- Dunne warns of 'consequences' if Maori Party supports RMA reform
Most listened to
- “A very ballsy thing to do” – Rodney Hide and Kelvin Davis discuss Serco’s response to Correction’s Mt Eden Prison report
- “The response from shareholders has been overwhelming” — A2 Corporation chief executive Geoff Babidge
- Greg Gent says a board of 13 people is "prehistoric"
- Arvida CEO Bill McDonald on his company's half-year net profit
- Lance Wiggs on the future of food exports
- Auckland Councillor Chris Darby on the Council's alternative funding report
- Nevil Gibson discusses his latest Editor's Insight on oil prices
- Campbell Gibson, Nick Grant and Chelsea Armitage chat about the inner workings of New Zealand media
- Paul Brislen discusses the 'snake oil' sales tactics of SalesConcepts
- Fonterra chief executive Theo Spierings reveals his ambitious China plan
- UDC Finance chief executive Wayne Percival talks about the company's profit
- Hamish McNicol discusses the latest court stories