Kiwi dips as doubts grow about pace of global growth
The New Zealand dollar slips against most of its trading peers amid concern the US and Chinese economies may be stumbling.
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The New Zealand dollar fell against most of its trading peers amid concern the US and Chinese economies may be stumbling, weighing on growth assets such as equities, the kiwi and Australian dollars.
The kiwi fell to 83.89 US cents from 84.19 cents in late New York trading on Friday. The trade-weighted index slipped to 77.65 from 77.91.
US economic growth figures for the first quarter round out a data-heavy week, along with American durable goods orders and consumer confidence.
Figures last week showed the Chinese economy grew a slower-than-expected 7.7 percent annual pace in the first quarter. US earnings will also be closely watched, with Apple, DuPont, Caterpillar and Exxon Mobil set to post their results.
Weakness in US data will stoke global risk aversion and weigh on stocks and the kiwi, says Imre Speizer, senior markets strategist at Westpac Banking Corp. Investors "will pull back risky trades".
Locally, the Reserve Bank's review of interest rates on Wednesday is likely to be the highlight. Mr Speizer expects governor Graeme Wheeler to highlight the strong currency but he is likely to balance that against concern the housing market may be overheating.
The Wall Street Journal cited Min Zhu, deputy managing director of the International Monetary Fund, as saying the Australian and New Zealand dollars are overvalued by about 10 percent. That has not deterred traders who last week drove up net long positions in the kiwi to record levels.
The kiwi fell to 64.11 euro cents from 64.50 cents and fell to 55.05 British pence from 55.27 pence. It declined to 81.60 Australian cents from 81.90 cents and traded little changed at 83.71 yen after the Group of 20 nations left out any specific mention of its bond-buying programme in its official statement.
(BusinessDesk)
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Kiwi dips as doubts grow about pace of global growth
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