Dollar firmer ahead of jobs data, despite Govt concerns

Photo / Dean Purcell

The New Zealand dollar was firmer ahead of the latest household labour force survey figures being released this morning, despite the Government expressing renewed concerns about the strong kiwi hindering economic recovery.

The kiwi was trading at US73.52c at 8am compared with US73.44c at 5pm yesterday.

ANZ head of market economics and strategy Khoon Goh said in a market brief that the second quarter employment release this morning would be the focus of markets locally. Offshore markets, however, were unlikely to be deterred from adding further support to the kiwi should it dip closer to the US73c level.

He said the New Zealand dollar had traded in tight ranges despite plenty of action around the world.

"Demand sub US73c at this point has the base covered while sellers closer to US74c are waiting patiently for the move higher."

Better than expected US economic data helped push equities higher, though the gains were modest, he said.

At home there was no doubt the labour market was improving but Finance Minister Bill English yesterday noted the strength of the New Zealand dollar was a headwind for the country's economic recovery.

The kiwi was firmer against other major trading partners' currency, except the Australian dollar. But Goh said yesterday's Australian trade surplus for June failed to knock the cross rate under A80c.

The kiwi was at A80.16c at 8am from A80.49c at 5pm, 0.5584 euro from 0.5558, and 63.47 yen from 62.72.

The trade weighted index rose to 67.86 from 67.68.

- NZPA