By ELLEN READ
The New Zealand dollar refused to be bothered by the weekend's election, trading quietly in a narrow range yesterday.
Westpac currency strategist Johnathan Bayley said the kiwi hit a low of 46.18USc during Friday's offshore session, but had risen slightly to 46.30USc by yesterday's local open.
During the day, the currency bounced up to 46.66USc but retreated in later trade on very thin volume.
The effect of the election result was neutral to slightly positive - because Labour had more choice of potential parliamentary supporters - for the currency, Bayley said.
"But there's nothing really startling there for the kiwi, nothing that would make you want to buy or sell it in large volumes," he said.
Westpac tips a 45.8-47.2USc range for the week.
The direction will be dictated by a run of US data due later in the week - including preliminary Q2 GDP figures, consumer confidence and the US Federal Reserve's so-called Beige Book survey of economic conditions around the country.
"The dominant driver of New Zealand dollar price action remains the global environment, which continues to present downward risk for the currency," Bayley said.
First NZ Capital economics and strategy director Jason Wong said the election result was "not a bad outcome" for the local market.
"A relatively stable government is likely to be formed, concessions to the Greens will be a lot less than some feared, and United Future's influence is positive for business," he said, adding that Peter Dunne's party believes in free-market policies balanced by social responsibility.
The vote outcome is slightly positive for New Zealand asset prices, although investors ought to focus more on the global backdrop, politics being largely a side issue, Wong said.
<i>Currency:</i> Election outcome leaves kiwi dollar unmoved
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