Currency Talk: More downwards pressure on the kiwi/US cross rate
Jason Walls and ANZ's Sam Tuck discuss the global currency market news on NBR Radio and on demand on MyNBR Radio.
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Optimistic US employment data has increased the chances of a US interest rate hike in December and lowered the value of the kiwi against the greenback.
Non-farm payroll data – the primary measure of US employment – revealed the US economy had added 271,000 jobs in October.
This is up 90,000 jobs on the month prior, bringing the unemployment level down to 5%.
ANZ senior market strategist Sam Tuck says the market pricing for a December rate hike is now almost 70%.
“The Fed speakers have said recently they only need numbers of about 80,000 – 120,000 jobs per month and we’re getting an average north of 200,000 with this release.”
He says broadly speaking, the markets are “in love with the numbers.”
The kiwi dollar dropped against the US after the jobs data was announced and is expected to drop further in the lead up to a December rate hike by the Fed, and a predicted cut in New Zealand’s official cash rate also in December.
There has also been downward pressure on the kiwi/ Aussie cross rate, after the Reserve Bank of Australia kept its interest rates on hold last week, while Statistics New Zealand revealed a drop in the number of people employed.
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NBR Radio
Tue, 10 Nov 2015
Tue, 10 Nov 2015
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Currency Talk: More downwards pressure on the kiwi/US cross rate
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