The New Zealand dollar was rangebound today ahead of an interest rate announcement by the Reserve Bank on Thursday.
BNZ currency strategist Danica Hampton said the kiwi dollar followed the majors as the greenback gained strength against the euro, sending the kiwi to an intraday low of US62.16c.
It climbed back to close at US62.31c compared with US62.15c at close on Friday.
All eyes are on the Reserve Bank, which most analysts expect to hold base interest rates steady at 7.25 per cent, despite high consumer price data last week.
Ms Hampton said the market had priced in a 20-25 per cent chance of a rate hike by September, but not the BNZ.
"We think they (the RB) will reiterate a similar sentiment to what they delivered in June -- acknowledging there are inflation risks from global oil prices and that they'll leave the door ajar for an opening if required. But pretty much, we think they've finished their tightening cycle."
Ms Hampton said the kiwi could lose ground against the Australian dollar on Wednesday if Australian consumer price data increases expectations of an interest rate hike in September.
Against other currencies today, the kiwi was buying A82.85c (A82.90c on Friday), 0.4923 euro (0.4915), and 72.61 yen (72.60). The TWI was at 62.67 (62.61).
Other New Zealand data this week are June's merchandise trade figures out on Wednesday and June building consent figures on Friday. The National Bank business outlook is also due out on Wednesday.
Rates
5pm today 5pm today
NZ dlr/US dlr US62.31c US62.15c
NZ dlr/Aust dlr A82.85c A82.90c
NZ dlr/euro 0.4923 0.4915
NZ dlr/yen 72.61 72.60
NZ dlr/stg 33.60p 33.61p
NZ TWI 62.67 62.61
Australian dollar US75.23c US74.96c
Euro/US dollar US1.2658 US1.2647
US dollar/yen 116.53 116.81
- NZPA
- NZPA
<i>Currency:</i> Kiwi rangebound ahead of interest rate news
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