You are using an older browser version. Please use a supported version for the best MSN experience.

NZ dollar slide may be near end

NZN 1/05/2017 Paul McBeth

The New Zealand dollar may be ripe for a turnaround after falling over the past month.

Local data this week is expected to show the labour market in good heart and the latest dairy auction may show resilient global dairy prices.

The kiwi dropped 1.5 per cent against the greenback in April and was trading near a 10-month low at US68.56c at 5pm in Wellington from 68.66c on Friday in New York.

The local currency has been under pressure as heightened geopolitical tensions stoked investors' demand for safe-haven currencies, while the mounting prospect of greater trade barriers was seen weighing on the kiwi and New Zealand's trading ambitions.

That's seen a build up in traders taking short positions against the kiwi, betting the currency will decline.

That comes ahead of a GlobalDairyTrade auction and employment figures on Wednesday which will likely show dairy prices are still firm and jobs growth remains robust.

"The employment numbers will be a particularly interesting read and if they get some strong numbers you'll see the kiwi bounce up," said Michael Johnston, a senior dealer at HiFX in Auckland.

"It could nudge up to 70 (US cents)" although Mr Johnston said he still expects the kiwi will fall over the medium- to long-term.

Trading was relatively quiet in Monday trading with parts of Asia and Europe closed for the May Day and Labour Day holidays.

The kiwi traded at A91.62c from 91.63c last week ahead of Tuesday's Reserve Bank of Australia policy review and slipped to 4.7231 Chinese yuan from 4.7307 yuan last week in the lead-up to Chinese manufacturing data.

The local currency was little changed at 76.53 yen from 76.58 yen last week and 62.94 euro cents from 63 cents. It traded at 53.10 British pence from 53 pence last week.

image beaconimage beaconimage beacon