Kiwi gains after weak US inflation data
The US dollar index fell following inflation data, which undershot expectations for the fifth straight month.
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The New Zealand dollar gained after weaker-than-expected US inflation data added to doubts the Federal Reserve will hike interest rates for the third time this year.
The kiwi traded at 73.09 US cents as at 8am in Wellington, from 73.18 cents in New York on Friday and up from 72.73 cents in Wellington at the end of last week. The trade-weighted index rose to 76.99 from 76.82 in New York.
The US consumer price index excluding food and fuel prices rose 0.1 percent in July, half the pace expected, while the annual rate was unchanged at 1.7 percent. The US dollar index fell following the data, which undershot expectations for the fifth straight month, according to Bank of New Zealand. The ongoing war of words between the US and North Korea, meanwhile, has eroded risk appetite, with the volatility index, or VIX, touching its highest level this year on Friday.
"Another soft inflation print has seen USD sentiment turn south again and means further tests of downside support for the NZD/USD are likely to be too hard near-term, especially as the kiwi hovers around key support zones for other crosses," said Philip Borkin, senior economist at ANZ Bank New Zealand.
Traders will be watching today for the performance of services index for July and second-quarter retail sales after the Reserve Bank last week kept the outlook for interest rates unchanged in its monetary policy statement.
The kiwi slipped to 4.8687 yuan from 4.8747 yuan on Friday in the US, declined to 61.83 euro cents from 61.91 cents and decreased to 56.18 British pence from 56.24 pence. The kiwi was at 92.57 Australian cents from 92.67 cents.
(BusinessDesk)
Jonathan Underhill
Mon, 14 Aug 2017
Mon, 14 Aug 2017
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Kiwi gains after weak US inflation data
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