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NZD posts worst week in 4 months on election jitters; AUD muted
[WELLINGTON] The New Zealand dollar hovered near two-month lows on Friday and was on track for its worst weekly performance since end-April, while its Australian counterpart had another lacklustre week.
The New Zealand dollar stood at US$0.7209, not far from the previous session's US$0.7192, which was the lowest level since June 22.
The currency is poised to fall more than two per cent this week for its fourth consecutive week of losses.
The Australian dollar was steady at US$0.7900, spending all of this week between US$0.7951 and US$0.7882.
The Aussie has dipped 0.3 per cent this week, and has eased 1.3 per cent this month after solid gains in June and July.
Traders are now looking for any monetary policy clues from an annual gathering of central bankers in Jackson Hole, Wyoming, where US Federal Reserve Chair Janet Yellen and European Central Bank President Mario Draghi were set to speak later in the day.
"Our view is that policy changing speeches are not delivered outside of scheduled central bank policy meetings, so the Jackson Hole Economic Symposium is likely to disappoint market participants that expect game changing speeches to be delivered," said Kristina Clifton, economist at Commonwealth Bank.
Australia's economic calendar will be back in full swing following a very quiet week with partial indicators in the lead up to second-quarter gross domestic product on Sept 6.
In New Zealand, traders were skittish ahead of a hotly-contested election between labour leader Jacinda Ardern and Prime Minister Bill English.
The Kiwi sold-off heavily in the middle of the week after the New Zealand government downgraded the country's growth outlook for this fiscal year and next.
That led some in the market to believe that the government's chances of a re-election next month was waning.
New Zealand government bonds gained, sending yields 5 basis points lower.
Australian government bond futures slipped, with the three-year bond contract down two ticks at 98.010. The 10-year contract was off one tick to 97.3600.