The New Zealand dollar slipped to a four-day low against the euro after the European Central Bank indicated it has moved to a more neutral stance after cutting interest rates last month.
The kiwi dropped as low as 59.77 euro cents early this morning and was trading at 60.12 cents at 8am in Wellington from 60.40 at 5pm yesterday. The local currency edged up to 82.16 US cents from 82.07 cents yesterday.
The 17-nation European currency appreciated after the ECB yesterday kept its key interest rate unchanged at its last policy meeting of the year and president Mario Draghi gave no indication that he would introduce further monetary stimulus to boost the region's economy. The bank surprised financial markets last month by cutting its key rate to 0.25 percent after weaker inflation data.
"Euro strengthened last night as the European Central Bank moved to a more neutral stance after last month's cut," Con Williams, agri economist at ANZ New Zealand, said in a note. "Without any new additional liquidity/policy measures and a relatively neutral tone from Draghi at the press conference the euro rallied."
Today, traders are awaiting a key employment report from the US which is expected to show non-farm payrolls increased 180,000 last month and the unemployment rate fell to 7.2 percent from 7.3 percent, according to a Reuters survey of economists.
