NZ dollar edges lower ahead of G20 meeting
North Korea's missile test is keeping investors nervous.
The New Zealand dollar dipped in the local trading session ahead of the Group of 20 nations meeting this weekend, as investors remain nervous about North Korea after this week's missile test.
The kiwi decreased to 72.74 US cents as at 5pm in Wellington from 72.85 cents as at 8am in Wellington from 72.83 cents late yesterday. The trade-weighted index was at 78.25 from 78.26 yesterday.
Investors are awaiting the G20 meeting and a United Nations Security Council meeting with more vigour after North Korea's first successful intercontinental ballistic missile test weighed on markets. US President Donald Trump is expected to meet with both his Russian and Chinese counterparts, Vladimir Putin and Xi Jinping, and the missile test is seen as forcing them to find some common ground in dealing with the rogue state.
"The market is trying to ignore the North Korean threat but we've got G20, so the amount of activity will slowly dissipate and I think the market will be a bit worried about weekend risk or any sort of communiques that come out of the G20," said Martin Rudings, senior dealer foreign exchange at OMF in Wellington. "Generally the kiwi dollar's on hold for any escalation and further pressure from a weekend event."
The local currency dipped below 73 US cents as surging US bond yields lured investors back to the greenback as central bankers around the world start talking more aggressively about raising interest rates. That's put New Zealand and Australia at odds with the rest of the world with both Reserve Banks indicating they've got no plans to move anytime soon.
The kiwi traded at 95.70 Australian cents from 95.62 cents yesterday and fell to 4.9477 Chinese yuan from 4.9504 yuan yesterday. It traded at 64.18 euro cents from 64.14 cents and was edged down to 56.23 British pence from 56.38 pence. The kiwi fell to 82.23 yen from 82.45 yen.
New Zealand's two-year swap rate dropped 2 basis points to 2.28 percent and 10-year swaps fell 3 basis points to 3.31 percent.
(BusinessDesk)
Paul McBeth
Thu, 06 Jul 2017
Thu, 06 Jul 2017
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NZ dollar edges lower ahead of G20 meeting
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