Kiwi dollar little changed near month-low
The kiwi traded at 70.50USc as at 8am in Wellington.
The New Zealand dollar was little changed near its lowest levels in almost a month on speculation the Reserve Bank will have a clear run at cutting interest rates after announcing plans for further mortgage lending restrictions.
The kiwi traded at 70.50USc as at 8am in Wellington, from 70.27USc late yesterday when it tumbled following the Reserve Bank's announcement of further measures to cool the housing market. The trade-weighted index slipped to 75.65 from 75.74 yesterday.
The kiwi dropped yesterday and swap rates fell to record lows on the Reserve Bank's latest plan to prevent an overheated housing market becoming a financial stability risk. The bank is due to give an economic update tomorrow, which is expected to signal its disquiet with a currency that's well above its projections on a TWI basis, constraining import prices and making it harder to return inflation to within its target range. Traders are betting on a second cut to the official cash rate after one pencilled in for August.
The Reserve Bank's proposed new loan-to-value restrictions "have added to the market's conviction that further OCR cuts are coming in August and beyond," ANZ Bank New Zealand agri economist Con Williams said in a note. "Dairy prices still range trading, which will place pressure on opening milk price forecasts from May."
Dairy product prices were mixed at the latest GlobalDairyTrade auction as a gain in whole milk powder offset a decline for most other products. The GDT price index slipped to $US2336, down from $US2345 at the previous auction two weeks ago. Whole milk powder rose 1.9% to US$US2079 a tonne.
The kiwi rose to 93.87Ac from 93.35Ac yesterday as minutes of the Reserve Bank of Australia's latest meeting kept open the door to further rate cuts.
It slipped to ¥74.73 from ¥74.80 yesterday and dropped to 4.7166 Chinese yuan from 4.7488 yuan. It rose to 53.81 British pence from 53.57 pence yesterday and decreased to 63.96 euro cents from 64.08 cents.
(BusinessDesk)
Jonathan Underhill
Wed, 20 Jul 2016
Wed, 20 Jul 2016
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Kiwi dollar little changed near month-low
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