By Rebecca Howard
Nov. 5 (BusinessDesk) - The New Zealand dollar eased against the greenback after strong US jobs and wages growth
reinforced expectations the Federal Reserve will raise rates in December.
The kiwi traded at 66.36 at 8am in Wellington versus 66.52 at 5pm last Friday. The trade-weighted index was at 72.42
from 72.74.
US employers added 250,000 jobs to their payrolls in October and unemployment held at a 49-year low of 3.7 percent.
Also, wages increased 3.1 percent from a year earlier, the biggest year-over-year gain for average hourly earnings since
2009.
Markets, however, are still jittery about US-China trade tensions. OMF private client manager Stuart Ive noted that
White House economic adviser Larry Kudlow had told CNBC that the president had not asked US officials to draw up a
proposed trade plan for China despite that being reported by Bloomberg.
Kudlow added that he was not as optimistic as he once was about the two nations reaching a deal and additional tariffs
on Chinese imports would be ready, depending how talks go. The US president, however, is still predicting the two sides
can reach ‘a good deal.’
Looking ahead, the main domestic event for the kiwi this week is the central bank's monetary policy statement Thursday.
While the RBNZ is expected to keep rates on hold at a record low 1.75 percent the focus will be on whether or not the
bank is more upbeat about the domestic economy and whether it no longer signals a rate cut may be possible.
Ive, however, said that while the New Zealand dollar has been performing well on the back of improving local data "this
is unlikely to make the RBNZ suddenly change tone and become hawkish, far from it."
New Zealand jobs data Wednesday will also be closely watched for any signs of inflationary pressure coming through
wages.
The kiwi traded at 50.88 British pence from 51.21 British pence Friday, as investors speculate about Brexit progress.
The kiwi traded at 92.22 Australian cents from 92.44 Australian cents. It was at 4.5718 Chinese yuan from 4.6100 yuan
and traded at 75.03 yen from 75.97 yen. It was at 58.18 euro cents from 58.36 cents yesterday.
(BusinessDesk)
ends