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NZ dollar gains on UK slowdown talk

NZ NewswireNZ Newswire 22/05/2016 Tina Morrison

The New Zealand dollar rose against the British pound after Bank of England officials suggested that the UK's economic slowdown was due to more than just the risk the country could leave the European Union.

The kiwi jumped to 46.60 British pence at 8am in Wellington, from 46.32 pence on Friday. The local currency was little changed at 67.56 US cents from 67.62 cents at the New York close and 67.60 cents on Friday.

The British pound had broadly improved last week on optimism voters would choose to stay in the European Union in an upcoming referendum on June 23, benefiting the economy. However, it has since retreated after central bank officials Gertjan Vlieghe and Kristin Forbes raised doubts about whether Britain's economic slowdown was due solely to the risk of the so-called Brexit vote.

"The British pound fell as BoE officials suggested that the economic slowdown could be broadening beyond Brexit," ANZ Bank said. "These comments weighed on the British pound, together with some uncertainty regarding the latest Brexit polls."

The New Zealand dollar edged up to 93.63 Australian cents from 93.50 cents on Friday. It was little changed at 60.30 euro cents from 60.33 cents, was at 74.46 yen from 74.39 yen, and at 4.4281 yuan from 4.4241 yuan. The trade-weighted index was at 72.89 from 72.82.

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