Thursday 10th December 2015 |
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The New Zealand dollar was little changed ahead of the Reserve Bank meeting today where Governor Graeme Wheeler is expected to reduce the benchmark interest rate.
The kiwi was at 66.36 US cents at 8am in Wellington, from 66.28 cents at 5pm yesterday. The trade-weighted index was at 72.09 from 72.10 yesterday.
The local currency has slid 1.6 percent this week leading up to today's Reserve Bank interest rate decision. Some 21 of 24 economists polled by Reuters expect the central bank to cut the benchmark rate by a quarter point to 2.5 percent. Traders have increased their bets for a quarter point cut to 81 percent, from 68 percent at the start of the week, according to Thomson Reuters data.
"The New Zealand dollar has continued to weaken against most of its major trading partners ahead of this morning’s all important RBNZ monetary policy statement," Michael Johnston, a senior trader at HiFX said in a note. "The market is poised as well as partially positioned for the RBNZ to cut the overnight cash rate by 25 basis points, and should this be the case, it will be the tone of Reserve Bank Gov Wheeler’s statement that will determine direction thereafter."
The Reserve Bank will release its decision at 9am in Wellington, followed by a news conference. Governor Wheeler is scheduled to appear before parliament's finance and expenditure select committee at 1pm.
Also this morning, Fonterra Cooperative Group is expected to update the market on its forecast payout to farmers. Dairy products are New Zealand's biggest commodity export, and a decline in global prices sparked the RBNZ to start cutting rates earlier this year.
Other releases scheduled for today include the Real Estate Institute's monthly house sales data, and Statistics New Zealand releases on accommodation and electronic card spending for November.
Elsewhere, the Bank of England also reviews policy today and Australia publishes employment data for November.
The New Zealand dollar advanced to 92 Australian cents from 91.76 cents yesterday, slid to 60.21 euro cents from 60.77 cents, fell to 43.72 British pence from 44.15 pence, declined to 80.42 yen from 81.38 yen, and edged up to 4.2675 yuan from 4.2570 yuan.
BusinessDesk.co.nz
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