Article – Businesswire

March 9 (BusinessWire) – The New Zealand dollar held at a two-week high of about 70 U.S. cents against a backdrop of more upbeat U.S. economic data and signs of stability in Europe, as traders await the central bank’s review of interest rates on Thursday.

NZ dollar little changed ahead of MPS, signs of stability in Europe

March 9 (BusinessWire) – The New Zealand dollar held at a two-week high of about 70 U.S. cents against a backdrop of more upbeat U.S. economic data and signs of stability in Europe, as traders await the central bank’s review of interest rates on Thursday.

Greek Prime Minister George Papandreou called for nations to crack down on “unprincipled speculators” who he blames for much of his country’s woes with surging finance costs. EU leaders are backing plans to create a lender of last resort to help support member states. In the U.S., data on Friday showed the economy shed fewer than expected jobs while consumer credit rose for the first time in a year. In New Zealand, Reserve Bank Governor Alan Bollard is widely expected to keep the official cash rate at a record low 2.5% on Thursday, reflecting the economy’s tepid recovery with little inflation.

There’s an “increasing risk” that Bollard tweaks the wording of his statement to signal he won’t raise the OCR until the latter part of 2010, said Alex Sinton, currency dear at ANZ National. “When you’re talking about a market digging fairly deep and looking at every phrase, those kinds of changes are very significant.”

The kiwi dollar bought 70.04 U.S. cents, little changed from 70.03 cents late yesterday. The currency traded at 76.93 Australian cents from 76.82 and rose to 46.45 British pence from 46.18 pence.

The New Zealand dollar bought 51.36 euro cents from 51.21 and traded at 63.21 yen from 63.35.

Sinton said the kiwi may trade in a range of 69.65 U.S. cents to 70.50 cents today.

The currency rose yesterday after figures showed manufacturing sales volumes climbed 3.1% in the fourth quarter, while building work put in place climbed.

The data was “a clear reminder of the NZ economic turnaround we believe is brewing,” Bank of New Zealand currency strategist Mike Jones said in a note.
The lender raised its production GDP growth estimate to 0.8% from 0.4% on the back of the numbers.

Stocks were little changed on Wall Street, with the Standard & Poor’s 500 easing 0.02% to 1138.50. The benchmark index has climbed 6.4% in the past month.

Sinton said signs of resurgent growth closer to home include Australia’s jobs boom, with the economy of New Zealand’s biggest export market adding 194,600 workers in the five months through January, pushing down the jobless rate to 5.3%.

Japan, Asia’s biggest economy, added the most jobs in more than 30 years and the unemployment rate unexpectedly fell to 4.9%.

In New Zealand, the government statistician is due to release electronic card transaction figures for February, which will provide the latest snapshot of consumer spending.

The value of transactions on electronic cards at retailers rose 0.5% in January, the third monthly gain.

(BusinessWire)

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