NZ dollar weakens as investors shed commodity currencies
The kiwi traded at 67.25USc at 8am in Wellington.
The New Zealand dollar declined as investors sought safe haven investments after commodity prices weakened and amid investor nervousness ahead of the Federal Reserve's interest rate review this week.
The kiwi traded at 67.25USc at 8am in Wellington from 67.19USc at the New York close, down from 67.48USc on Friday. The trade-weighted index slid to 73.24 from 73.36 on Friday.
Commodity-linked currencies such as the kiwi and Australian dollars fell after oil plunged to its lowest in more than six years, concerns resurfaced about the US junk bond market, and amid investor nervousness ahead of the Fed meeting this week. The Federal Reserve Open Market Committee is widely expected to hike interest rates from the near-zero policy introduced in December 2008, with investors focused on signals as to the outlook for future moves.
"Reduced risk appetite saw so-called safe haven currencies like Japanese yen, euro and Swiss franc outperforming, while the commodity currencies underperformed," Jason Wong, Bank of New Zealand currency strategist, said in a note. "The FOMC meeting on Thursday will be closely watched. The probability of the first rate increase in more than a decade is running at around 75% but the focus will be on how quickly the policy rates might be raised through 2016 and beyond."
In New Zealand today, the BNZ-BusinessNZ performance of services index for November is scheduled for release at 10:30am. Japan and Europe publish data on industrial production and Japan also releases its Tankan manufacturing index.
The New Zealand dollar slipped to 4.3402 yuan from 4.3523 yuan on Friday. China's central bank said it would publish a new index for the yuan, comprised of 13 currencies, reducing the focus on the yuan rate against the US dollar.
The local currency advanced to 93.22Ac from 93.09Ac on Friday, slipped to 44.17 British pence from 44.56 pence, dropped to 61.23 euro cents from 61.69 cents, and declined to 81.41 yen from 82.40 yen.
(BusinessDesk)
Tina Morrison
Mon, 14 Dec 2015
Mon, 14 Dec 2015
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NZ dollar weakens as investors shed commodity currencies
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