BUSINESSDESK: The New Zealand dollar rose in the local trading session as investors ignored Reserve Bank Governor Alan Bollard’s jawboning amid optimism US employment is on the mend and Greece finalises its debt-swap.
The kiwi rose to 82.54 US cents at 5pm from 82.48 cents at 8am, up from 81.85 cents yesterday. The trade-weighted index advanced to 73.13 from 72.65.
Asian equity markets followed the rally in Europe and on Wall Street as investors are optimistic private investors holding Greek government debt will agree to the terms of a debt swap enabling the regional bail-out for the Mediterranean nation. The prospect of employment growth in the world’s economy added to the upbeat sentiment, and economists expect some 210,000 jobs were added in the US last month, according to a Bloomberg survey.
Positive global markets overnight and some further follow-through in the US employment figures should support the kiwi dollar, said Dan Bell, currency strategist at HiFX in Auckland. “It does look like, in a very short-term sense, the dip (in the kiwi) is done.”
Investors shrugged off Bollard’s warning that a stronger kiwi dollar could lead to a rate cut, a day after he held the official cash rate at 2.5 percent.
Bell said the prospect of the Reserve Bank cutting rates seemed highly unlikely, and questioned how high the dollar would have to go, given it hit a post-float high against the greenback in August last year.
Investors shrugged off weak Australian trade figures, which showed the first deficit since February last year, though the tepid level of Chinese exports was put down to Lunar New Year.
The New Zealand dollar rose to 62.22 euro cents from 62.14 cents and increased to 52.19 British pence from 51.96 pence. It gained to 77.59 Australian cents from 77.22 cents, and advanced to 67.51 yen from 66.45 yen.
Paul McBeth
Wed, 11 Jul 2018
Wed, 11 Jul 2018
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NZ dollar gains ahead of US employment data, Greek debt-swap
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