You are here

New Zealand dollar falls after jobless rate climbs, Australian dollar weaker

nzaus.jpg
The New Zealand dollar eased slightly on Wednesday as the country's jobless rate jumped and wage growth remained sluggish, while its Australian counterpart took a breather after three straight sessions of gains.

[SYDNEY] The New Zealand dollar eased slightly on Wednesday as the country's jobless rate jumped and wage growth remained sluggish, while its Australian counterpart took a breather after three straight sessions of gains.

New Zealand unemployment rose to 5.2 per cent in the December quarter, from an eight-year low of 4.8 per cent, but only because participation grew to a record.

The New Zealand dollar fell as low as US$0.7280 after the data, drifting away from a 10-week high of US$0.7345 as investors pared back the chance of a rate hike. It was trading down 0.5 per cent at 0209 GMT.

The data "won't worry the Reserve Bank of New Zealand too much, but the chances of it raising interest rates this year are very slim since wage growth will remain stubbornly weak," said economist Kate Hickie at Capital Economics.

sentifi.com

Market voices on:

Across the Tasman Sea, the Australian dollar eased 0.3 per cent to US$0.7560. It faces stiff chart resistance at 76 US cents, a level it has breached twice in the past month but failed to stay above that level for an entire session.

The currency has remained in a tight trading range between 75-76 US cents over the past 12 sessions. Technical analysts say a break above US$0.7610/20 would open the way for a jump to US$0.7720/40.

Both the Kiwi and the Aussie have had a strong run against the greenback so far this year, surging about 5.5 per cent each in January.

During that time, the greenback has sagged, with investors becoming increasingly risk averse due to US President Donald Trump's policies.

The latest blow to the US dollar came after Mr Trump and his top economics adviser took aim at the currency decisions of key US trade partners, further raising concern that Washington was poised to actively weaken the greenback.

Elsewhere, the Antipodean currencies eased against the yen, the euro and the pound. The euro rose 0.2 per cent against the Aussie and 0.4 per cent against the Kiwi. The Aussie and the Kiwi slipped 0.2 per cent each on the yen.

New Zealand government bonds rose, sending yields about 2.5 basis points lower across the curve.

Australian government bond futures eased, with the three-year bond contract off 1 tick at 98.06. The 10-year contract slipped 1.5 ticks to 97.24.

REUTERS

Powered by GET.comGetCom