NZ dollar little changed as risk-on rally runs out of steam

The New Zealand dollar was little changed as stock markets, and commodity prices ended their rally over recent days with figures showing US fuel supplies unexpectedly grew.

The kiwi traded at 72.68USc at 8 am in Wellington from 72.58USc yesterday. The trade-weighted index was little changed at 77.58 from 77.44.

Brent Crude oil prices fell 4.2% to $US46.45 a barrel after Energy Information and Administration figures showed US gas supplies rose 1.21 million barrels last week, outpacing a fall in demand.

Stocks on Wall Street were mixed with the Dow Jones Industrial Average edging up 0.1% and the Nasdaq Composite Index down 0.2%, while European equities were down across the board.

"The risk rally appears to be sputtering out with US equities turning slightly negative, oil and US Treasury bond yields lower," ANZ Bank New Zealand senior rates strategist David Croy says.

"The NZD remains in a 'buy on dips' tempo. Notwithstanding that, we expect the NZD to tread water ahead of a slew of partial local data, and to mimic moves in the AUD following important Australian June jobs data."

The kiwi was little changed at 95.52Ac from 95.41Ac ahead of Australia's employment report.

Local data today includes the BusinessNZ-BNZ performance of manufacturing index, ANZ-Roy Morgan consumer confidence survey, and Reserve Bank figures on foreign holdings of government bonds.

The kiwi rose to 55.32 British pence from 54.52 pence yesterday ahead of the Bank of England policy review on Thursday in London.

Theresa May was sworn in as the UK's new prime minister who will oversee the nation's exit from the European Union. The kiwi was little change at 65.51 euro c from 65.61 euro c yesterday.

The local currency rose to 75.90 yen from 75.59 yen as the market speculates on how much extra stimulus policy makers plan to pump into the world's third-biggest economy after Prime Minister Shinzo Abe's conservative coalition won the upper house at the weekend election.

The kiwi increased to 4.8573 Chinese yuan from 4.8518 yuan yesterday.

(BusinessDesk)