Dollar steady ahead of monetary policy statement

The New Zealand dollar consolidated in its domestic session today after rising off lows on Monday night.

The US dollar came under pressure after a dovish speech by US Federal Reserve chairman Ben Bernanke. Share markets faltered.

The NZ dollar was US71.47c at 5pm from US71.71c at the same time yesterday. It fell as far as US70.80c on Thursday night but its recovery was helped by the Bernanke remarks.

The focus is very much on Thursday's monetary policy statement by the Reserve Bank of New Zealand.

The central bank is even more likely to keep rates on hold after figures published by Statistics New Zealand today showed the seasonally adjusted volume of residential building work fell 5.4 per cent in the September quarter, to an eight-year low.

Also, manufacturing sales volumes fell a seasonally adjusted 1.4 per cent in the September quarter, led by a 7.1 per cent fall in meat and dairy manufacturing.

"The overall condition of the economy in Q3 was that of one continuing to track sideways, as the recovery struggles to gain traction," ASB economist Jane Turner said.

The NZ dollar was little changed at A78.13c by 5pm from A78.34c at the same time yesterday.

It fell against a strong yen to 63.62 yen from 64.40 yen and was little changed 0.4814 euro from 0.4816 euro yesterday.

The trade weighted index was 64.01 at 5pm from 64.22 yesterday.

- NZPA