Dollar weakens ahead of Chinese growth data
Kiwi edged lower to 67.95USc at 8am.
The New Zealand dollar declined ahead of economic data due from China today, which is expected to show weaker growth in this country's largest trading partner.
The kiwi edged lower to 67.95USc at 8am in Wellington, from 68.08USc at the New York close and 68.32USc on Friday. The trade-weighted index slipped to 72.74 from 73.04 on Friday.
Chinese data on retail sales, industrial production, fixed-asset investment and gross domestic product are the main focus for traders today. Chinese third-quarter growth is expected to have slowed to an annual pace of 6.8% from 7% in the second quarter, which would be the slowest since the financial crisis in 2009. A weaker reading would likely weigh on the kiwi and the Aussie currencies given the exposure of the two countries to Asia's largest economy.
Chinese policymakers had previously forecast growth of "around 7%" for 2015. China's Premier Li Keqiang said that, with the global economic recovery losing steam, achieving domestic growth of around 7% is "not easy," according to a transcript of his remarks posted on the website of the State Council, China's cabinet, and reported by Reuters at the weekend.
"While we know that the reports will not show dramatic slowdown in the Chinese economy, even a mild deterioration could trigger a wave of risk aversion in currencies," Kathy Lien, managing director of FX strategy for BK Asset Management in New York, said in a note. "The Australian and New Zealand dollars are at the greatest risk for losses not just because they are sensitive to Chinese growth but also because both currencies appreciated sharply in recent weeks."
In New Zealand today, the BNZ-BusinessNZ performance of services index is scheduled for release at 10:30am.
The New Zealand dollar was little changed at 93.60Ac from 93.69Ac cents on Friday, slipped to 43.98 British pence from 44.14p, weakened to 59.81 euro cents from 60.02 cents, edged lower to ¥81.15 from ¥81.36 and declined to 4.3164 yuan from 4.3428 yuan.
(BusinessDesk)
Tina Morrison
Mon, 19 Oct 2015
Mon, 19 Oct 2015
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Dollar weakens ahead of Chinese growth data
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