Kiwi slips but gains predicted
The New Zealand dollar eased marginally amid tight liquidity due to the Thanksgiving holiday in the US, but the currency looks set to rise on the back of a swathe of upbeat global manufacturing data.
The kiwi recently traded at US81.49 cents, down from US81.54c at 5pm yesterday, while on the Trade Weighted Index of major trading partners’ currencies it was little changed at 73.31 from 73.29.
Trading in the overnight session was marked by a positive mood after Performance of Manufacturing Index data showed activity in China and US had picked up, a good sign for the global economy.
Individual state figures out of Europe also showed glimmers of a recovery, particularly in France, but the overall picture suggested the eurozone is facing a protracted recession.
Reaction to the figures was muted with US participants away until Monday, though Europe’s Stoxx 600 Index rose 0.6 per cent to $2.71.70, it highest level in just over a week.
“Now both the US and Chinese early indicators are telling us that these economies are expanding,” said ANZ in a currency note. “The New Zealand dollar tends to do well on good global data, and this should keep it in demand and well supported on dips.”
On the crosses, the New Zealand dollar recently traded at 78.51 Australian cents, up from A78.45c yesterday, and it eased to 67.17 yen from 67.21 yen. The kiwi fell to 63.31 euro cents from 63.48 euro cents at 5pm, and rose marginally to 51.14 pence from 51.09 pence.
ANZ said the kiwi is expected to trade between a range of US81.30c and US81.80c, with the bias tipped to the upside on the day.