NZ dollar little changed against greenback ahead of Trump-Kim summit, central bank meetings

Tuesday 12th June 2018

The New Zealand dollar was little changed ahead of today's historic meeting in Singapore between US President Donald Trump and North Korean leader Kim Jong Un that may determine the degree of tension on the Korean peninsula and north Asia.

The kiwi dollar traded at 70.22 US cents as at 8am in Wellington from 70.36 cents late yesterday. The trade-weighted index fell to 73.55 from 73.68.

Trump has sounded an optimistic note about the meeting with Kim, saying it could "work out very nicely" while Kim took a tour of Singapore and thanked Prime Minister Lee Hsien Loong for facilitating the meeting. Currency traders said the event has the ability to generate some market volatility, depending on what the leaders say. Later this week are policy decisions and statements from the US Federal Reserve, the European Central Bank and the Bank of Japan, while the key focus tonight will be US CPI for May, which is expected to show a modest uptick in inflation.

"The NZD/USD remains confined within narrow ranges around the 0.70 level," said Con Williams, rural economist at ANZ Bank New Zealand. "Local data isn’t likely to drive direction today, but headlines from the North Korean Summit around 1pm could cause a little more volatility. Financial markets were becalmed ahead of major events this week."

In New Zealand today, electronic card spending for May will provide an update on consumer behaviour. Retail spending is expected to have gained 1.2 percent last month having dropped 2.2 percent the previous month.

The kiwi dollar was little changed at 52.45 British pence after weaker-than-expected industrial production figures and a wider trade deficit. It traded at 59.57 euro cents from 59.63 cents late yesterday after comments in an interview over the weekend from new Italian Finance Minister Giovanni Tria that his country is committed to the euro.

The kiwi traded at 77.25 yen from 77.23 yen and declined to 92.26 Australian cents from 92.52 cents. It fell to 4.4934 yuan from 4.5070 yuan.

(BusinessDesk)

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