NZ Dollar Declines As RBNZ Says Inflation Expectations Fall
February 24 2015 - 12:02AM
RTTF2
The New Zealand dollar weakened against the other major
currencies in the Asian session on Tuesday, after the Reserve Bank
of New Zealand said inflation expectations have declined. A
quarterly survey published by the Reserve Bank of New Zealand
showed that two-year ahead inflation expectations in New Zealand
eased to 1.80 percent in the first quarter from 2.06 percent in the
fourth quarter.
Inflation expectations for one-year fell to 1.11 percent from
1.59 percent, the quarterly report revealed. The survey was
conducted by the Nielsen Company.
Traders await the U.S. Federal Reserve Chair Janet Yellen's
testimony before the House and Senate due later in the day.
Yellen's remarks over the next two days are likely to be closely
analyzed for hints as to when an interest rate hike may happen in
the U.S.
Meanwhile, the New Zealand stock market also traded lower. The
benchmark NZSE 50 index is currently down 31.39 points or 0.55
percent at 5,722.
Monday, the New Zealand dollar fell to 0.09 percent against the
U.S. dollar, 0.006 percent against the euro and 0.009 percent
against the Australian dollar.
In the Asian trading today, the NZ dollar fell to a near 2-week
low of 0.7462 against the U.S. dollar and a 1-week low of 88.85
against the yen, from yesterday's closing quotes of 0.7516 and
89.34, respectively. If the kiwi extends its downtrend, it is
likely to find support around 0.72 against the greenback and 86.30
against the yen.
Against the euro, the kiwi slipped to a 5-day low of 1.5166 from
yesterday's closing quote of 1.5060. The kiwi may test support near
the 1.54 region.
Meanwhile, the Australian dollar also fell against its major
rivals after Reserve Bank of New Zealand downgraded inflation
expectations in its survey.
The Australian dollar fell to 5-day lows of 0.7761 against the
U.S. dollar and 1.4600 against the euro, from yesterday's closing
values of 0.7801 and 1.4525, respectively. If the aussie extends
its downtrend, it is likely to find support around 0.76 against the
greenback and 1.49 against the euro.
Against the yen and the Canadian dollar, the aussie slipped to
4-day lows of 92.42 and 0.9775 from yesterday's closing quotes of
92.68 and 0.9808, respectively. The aussie may test support near
89.15 against the yen and 0.96 against the loonie.
Looking ahead, the revised German GDP report is due at 2:00 am
ET. Final Eurozone CPI data for January is set to be published at
5:00 am ET.
At the same time, the Bank of England Governer Mark Carney and
several MPC members testify on inflation and the economic outlook
before Parliament's Treasury Committee, in London.
In the New York session, U.S. S&P/Case-Shiller house price
index for December and Markit's U.S. flash PMI reports, Conference
Board's U.S. consumer confidence index and U.S. Richmond Fed
manufacturing index - for February are due to be released.
At 9:00 am ET, European Central Bank President Mario Draghi will
deliver a speech at an event to unveil the new 20 euro banknote in
Frankfurt.
Subsequently, Yellen will testify on the Semiannual Monetary
Policy Report before the Senate Banking Committee in Washington DC
at 10:00 am ET.
At 1:45 pm ET, Bank of Canada Governor Stephen Poloz will
deliver a speech at the Western University, followed by news
conference in London, Ontario.
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