WELLINGTON - The New Zealand dollar firmed yesterday in mild trade, but most people were waiting for the signal to buy today - a static stance on interest rates from the US Federal Reserve.
The kiwi closed on its lows at 47.09USc, down on its 47.27c open but better than Tuesday's 46.97c.
"Anybody who is bullish on kiwi and aussie dollars is sitting back waiting to buy on the Federal Open Market Committee not acting to raise rates," a currency dealer said.
Deutsche Bank foreign exchange dealer Phil Lindberg said the common view was that Federal Reserve policy-makers would not increase key interest rates, but would likely issue another stiff warning about inflation risks.
The kiwi traded in a 47.07-36c range, with importers selling. "The kiwi feels like a sell on rallies, all other things being equal, and rallies seem to be pretty well capped," a dealer said.
A grim consumer confidence survey yesterday did not noticeably influence the currency. The market expects another bad number to emerge from the National Bank's June business confidence survey due today.
In its daily commentary, HSBC said yesterday morning's consumer survey had added to the general air of pessimism that had been exuding from other business and economic surveys.
Bonds rallied with the prospect of Reserve Bank rate rises receding as economic confidence dwindles. US Treasuries also assisted, rallying on rumours that the US would pay off its national debt a year earlier than expected.
- NZPA
Dollar buyers wait on Fed
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