Kiwi little changed as central bank meetings, Australian inflation figures loom
Traders will watch Australia's third-quarter consumer price figures tomorrow, which are expected to show an accelerating pace of inflation.
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BUSINESSDESK: The New Zealand dollar was little changed in local trading as investors gear up for central bank meetings in the US, Canada and New Zealand and for inflation figures across the Tasman.
The kiwi traded at 81.66 US cents at 5pm in Wellington from 81.59 cents at 8am and 81.73 cents yesterday in Asia. The trade-weighted index was little changed at 72.82 from 72.83.
New Reserve Bank of New Zealand governor Graeme Wheeler will mark his first official cash rate review on Thursday and is expected to keep the benchmark rate at 2.5%. That is against the backdrop of tepid inflation that is giving him scope to loosen monetary policy if he needs to give the economy a rev up.
Traders see a 15% chance of a cut at the meeting, according to the Overnight Index Swap curve.
"The full monetary policy statement in December will be way more revealing," says Chris Tennent-Brown, FX economist at Commonwealth Bank of Australia in Sydney. "The RBNZ is definitely the big thing" for the kiwi this week.
Investors will also keep tabs on the Federal Open Market Committee meeting in the US where the Fed may flesh out its plans to unwind Operation Twist, where it buys longer-dated debt and sells bonds with shorter maturities.
Bank of Canada governor Mark Carney is expected to talk down a tightening bias at a policy review tomorrow and keep the target for the overnight rate at 1%. The kiwi was little changed at 80.99 Canadian cents at 5pm in Wellington from 81.07 cents yesterday.
Traders will watch Australia's third-quarter consumer price figures tomorrow, which are expected to show an accelerating pace of inflation. Traders expect the Reserve Bank of Australia will cut the benchmark rate another quarter-point to 3% next month.
The kiwi weakened to 79.12 Australian cents from 79.24 cents yesterday and rose to 65.18 yen from 64.84 yen. It slipped to 50.98 British pence from 51.02 pence yesterday and fell to 62.54 euro cents from 62.68 cents.
Paul McBeth
Tue, 23 Oct 2012
Tue, 23 Oct 2012
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Kiwi little changed as central bank meetings, Australian inflation figures loom
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