Prefu good news already built into NZ dollar
The New Zealand dollar fell ahead of the pre-election fiscal and economic update this morning and as the greenback gained before the annual central banking conference in Jackson Hole, Wyoming later this week.
The kiwi declined to 72.75USc as at 8am in Wellington from 73.24USc late yesterday. The trade-weighted index was at 76.62 from 77.01.
Central bankers from around the world will make their annual trip to Jackson Hole, where the main focus will be on a speech by US Federal Reserve chairwoman Janet Yellen and the European Central Bank president Mario Draghi. Meanwhile, in New Zealand, the government will unveil the state of the books in the Prefu, which will give political parties a yardstick for their spending promises.
"With both Fed and ECB heads to speak, eyes are on potential policy messages with regard to rate hike timing, reductions in balance sheets or shifts in reaction functions," said Cameron Bagrie, chief economist at ANZ Bank New Zealand. "We continue to favour fading NZ dollar strength despite today's fiscal update providing good news; that good news is already widely known and understood."
The kiwi fell to 61.86 euro cents from 62.04 cents and traded at 56.73 British pence from 56.84 pence. It fell to 4.8445 yuan from 4.8755 yuan and slipped to 79.70 yen from 80.03 yen. The kiwi fell to 91.91Ac from 92.28Ac.