Kiwi dips RBA rate cut no surprise
Post on: 2011-11-02 By: admin
The New Zealand dollar was down against the greenback today, as the US currency gained from investors worries about risk while the euro zone debt crisis remains unresolved.
As was anticipated, the Reserve Bank of Australia announced this afternoon that it was cutting its cash rate by 25 basis points to 4.5 per cent.
The kiwi recently traded at US 80.77 cents, down from US80.90c yesterday and US81.14c this morning.
On the trade weighted index against major trading partners' currencies, it was at 70.40 late this afternoon, back slightly from 70.41 yesterday.
Westpac market strategist Imre Speizer said the New Zealand dollar had not changed a huge amount today, but had been up and down a bit.
"It's been dribbling lower over the last 24 hours," Speizer said.
"The kiwi today has been following the miniscule moves in the US equity market which is the main indicator of risk appetite. The Reserve Bank of Australia meeting was the major event of the day - the cut has not produced too much of a reaction because it was largely already priced in."
The RBA rate cut, just before the Melbourne Cup, was the first in over two-and-a-half years, and prompted swift cuts to mortgage rates by Australian banks.
Late this afternoon, the kiwi was buying 76.99 Australian cents, up from A76.89c yesterday and A76.58c this morning.
Renewed pressure came on the euro as doubts grew about the implementation of a plan agreed just last week to contain Europe's debt crisis.
Greek Prime Minister George Papandreou has called an unexpected referendum on a new EU bailout deal for his debt-ridden country, and Italian bond yields rose nearly to levels last seen inAugust indicating new concerns that problems in the euro zone's third largest economy could threaten the entire bloc.
Against the Japanese yen, the New Zealand dollar was trading at 63.09 yen down from 64.13 yen yesterday.
The kiwi was at 58.34 euro, up from 57.78 euro yesterday. Against sterling, it was at 50.24 pence, down from 50.71 pence late yesterday.
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Article original from: http://www.stuff.co.nz/marlborough-express/business/5886050/Kiwi-dips-RBA-rate-cut-no-surprise
