The New Zealand dollar gained from a two-month low as a poll showed there's still a chance Britain will vote to exit the European Union next month, creating market uncertainty that may discourage the Federal Reserve from hiking interest rates in June.
The kiwi rose to US67.44c as at 5pm, from US67.16c late on Thursday. The local currency rose to 45.97 British pence from 45.64 pence late on Thursday.
An ICM poll published this week showed 45 per cent of Britons favoured leaving the EU, dubbed Brexit, while 44 per cent wanted to stay in the EU bloc. The EU membership referendum is to be held on June 23, or about a week after the next Federal Open Market Committee. Traders are pondering whether uncertainty over Brexit will delay the Fed after Federal Reserve Governor Jerome Powell said yesterday that a rate hike could be appropriate fairly soon but the Fed had to weigh risks including Brexit and China's debt levels.
"If they want to run carefully it would be July" for an interest rate hike, said Mark Johnson, senior dealer at OMF.
The kiwi recovered from Thursday's selloff caused by Fonterra Co-operative Group setting the opening milk payout forecast for the coming season below market estimates, stoking concerns about a third season of low prices for New Zealand's largest export commodity.
