KEY POINTS:
The New Zealand dollar held steady today ahead of the Reserve Bank's quarterly Monetary Policy Statement due tomorrow morning.
At 5pm, the kiwi was buying US79.84c from US80.45c at 5pm yesterday. Against the aussie, the NZ dollar was on A86.08c against A86.17c yesterday.
All private sector economists expect Reserve Bank governor Alan Bollard to leave the cash rate unchanged on 8.25 per cent. As usual, the interest will be in the commentary and its tone.
While the Reserve Bank of Australia decided yesterday to lift the cash rate across the Tasman 25 basis points to 7.25 per cent, its accompanying statement was not as hawkish as expected.
The US Federal Reserve is expected to accentuate the difference in its stance from Australasia later this month when it cuts by another 75 basis points.
There could be scope for a similar line from the Reserve Bank given the weakness of the local housing market.
The US dollar was near a record low against the euro and a three-year trough versus the yen.
Traders said they were awaiting US payrolls figures due on Friday, the most anticipated release of the week. Weak data could support the view that aggressive interest rate cuts may be needed to lift the struggling US economy.
The dollar has plunged roughly 5 per cent against the yen in the past week while the euro has climbed around 3.5 per cent versus the US currency, and market participants see more dollar losses on the way.
Currency rates:
NZ dlr/US dlr US79.84c US80.45c
NZ dlr/Aust dlr A86.08c A86.17c
NZ dlr/euro 0.5253 0.5295
NZ dlr/yen 82.51 83.20
NZ dlr/stg 40.25p 40.53p
NZ TWI 71.86 72.32
Australian dollar US92.74 US93.28
Euro/US dollar 1.5197 1.5191
US dollar/yen 103.37 103.43
- NZPA
