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Kiwi up as US figures disappoint

NZ Newswire logoNZ Newswire 28/02/2017 Jonathan Underhill

The New Zealand dollar has risen against the greenback after the second reading of US fourth-quarter gross domestic product wasn't revised up as expected while the initial measure of US trade showed a bigger-than-expected deficit.

The kiwi increased to US72.17 cents as at 8am on Wednesday in Wellington from US71.82c late on Tuesday. The trade-weighted index rose to 78.47 from 78.11.

The US economy expanded at an annualised 1.9 per cent pace quarter-on-quarter in the fourth quarter, missing expectations for growth of 2.1 per cent, while the advance goods trade balance was a deficit of $US69 billion when a gap of $US66b was expected.

It was a night of mixed data in the US, with consumer confidence beating estimates in February. Traders said foreign exchange markets may not make meaningful moves before US President Donald Trump's speech to the Joint Session of Congress, which is expected to detail his policy plans.

"Markets remained in wait-and-see mode ahead of Trump's inaugural speech to Congress, although a mixed bag of US economic data did dent the USD, US interest rates and US equities slightly," said Westpac's Imre Speizer.

Locally on Wednesday, traders may watch for fourth-quarter terms of trade this morning, while Quotable Value data showed New Zealand property values continued to rise at an unchanged annual pace in February as buyers sought out new areas of growth with some of the usual suspects cooling off in the month. The average value of a New Zealand home rose 13.5 percent to $631,349 in February from a year earlier, with values up 1.1 percent on a rolling three-month basis, state-owned valuer Quotable Value said.

On Wednesday morning, the kiwi dollar rose to 94.02 Australian cents from A93.47c late Tuesday.

It rose to 58.11 British pence from 57.78p and gained to 68.03 euro cents from 67.84c. It was little changed at 80.87 yen from 80.90 yen and rose to 4.9535 yuan from 4.9341 yuan.

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