NZ dollar gains as traders await Jackson Hole symposium

Thursday 25th August 2016

Wall Street moved lower ahead of Friday’s speech by Federal Reserve Chair Janet Yellen who might offer clues on the timing for an interest rate hike by the central bank—which some Fed officials have recently suggested could be as early as next month.

The kiwi rose to 73.05 US cents at 8am in Wellington from 72.79 cents yesterday. The trade-weighted index advanced to 77.46 from 77.16 yesterday, still above the RBNZ's projection for the TWI to average 76 this quarter.

Currency markets are subdued as investors wait to see what's in store at the central banker symposium after Fed vice chair Stanley Fischer signalled in a speech last weekend that a 2016 rate hike was still under consideration and that measures of employment and productivity in the US economy were close to meeting the central bank’s goals. Yellen will deliver a speech at the event and if she leans toward an earlier rate hike that would be seen as supporting the greenback.

"The market remains very much in wait-and-see mode ahead of this weekend’s Jackson Hole gathering, where Fed chair Yellen is scheduled to speak," Bank of New Zealand market strategist Kymberly Martin said in a note. "The NZD/USD pushed higher last evening after trading sideways for much of yesterday. However, it again found resistance at range highs approaching 0.7340."

The kiwi rose to 95.94 Australian cents from 95.69 cents yesterday and increased to 4.8597 Chinese yuan from 4.8458 yuan. It rose to 64.79 euro cents from 64.45 cents and was little changed at 55.17 British pence from 55.24 pence. The kiwi increased to 73.35 yen from 73.13 yen yesterday.

BusinessDesk.co.nz

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